Investor Group Seeks Transparency on Netflix Political Lobbying, Citing ‘Potential Reputational Damage’

A Netflix investor group has submitted a shareholder proposal seeking more transparency regarding the streamer’s political lobbying and contributions.

In a May 18 regulatory filing, Boston Common Asset Management said it is seeking shareholder support for its Proposal 8 on the company’s upcoming 2022 shareholder proxy vote.

The group seeks input on Netflix policy and procedures governing lobbying, both direct and indirect, in addition to any payments made by the streaming behemoth. Specifically, Boston Common seeks intel on Netflix’s membership in and payments to organizations that write and endorse legislation. It also seeks a description of co-CEO’s Reed Hastings and Ted Sarandos’ management and the board’s decision-making process and oversight for making the aforementioned payments.

“Without a clear system ensuring accountability, corporate assets can be used to promote public policy objectives that are misaligned with company public positions and principles, and therefore can pose risks to Netflix’s reputation to the detriment of shareholder value,” Boston Common wrote in the filing.

According to the filing, Netflix spent about $690,000 on federal lobbying in 2021, and more than $8.8 million since 2012. The tally does not include state lobbying expenditures. Boston Common claims Netflix spent $406,250 on lobbying in California from 2019 to 2020. Netflix also reportedly spent between €700,000 ($739,000) and €799,999 ($845,000) on lobbying in Europe in 2020.

According to press reports, Netflix has “focused more of its public policy strategy internationally, where most of its growth lies and where it faces tenacious regulators.”

Netflix says it opposes Proposal 8, contending it already discloses political and lobbying expenditures.

Comcast Shareholders Nix Lobbying Transparency

Comcast shareholders June 11 voted against a proposal that would have called for greater disclosure of funding spent by the media company on industry lobbying.

Comcast spent more than $29 million in 2016 and 2017 on federal lobbying activities — fourth highest among U.S. companies, according to shareholder Kate Monahan. Speaking at Comcast’s annual shareholder meeting, Monahan claimed the company fails to reveal how much is spent lobbying at the state and local level.

She called on shareholders to approve her proposal requesting the board disclose all funds spent on lobbying. Monahan also called on Comcast to exit the American Legislative Exchange Council, a non-profit she claimed works against clean energy adoption.

“Investors have no idea how much the company is spending overall and yet the company could easily and inexpensively disclose this information,” Monahan said.

Shareholders, not surprisingly, rejected the proposal, according to preliminary vote tallies.

CEO Brian Roberts, after reiterating company highlights in fiscal year, reminded shareholders that anyone fortunate to buy a lot Comcast stock 46 years ago would be very rich today.

“If you had bought 1,000 shares of our stock with my dad at $7 a share in 1972, you would now have $10 million versus nearly $700,000 if you’ve invested in the S&P 500,” Roberts said.