On June 1st, Walmart held its annual shareholders meeting and voted on a proposal designed to pull the company into the abortion debate against state-level protections for the unborn. The proposal was defeated overwhelmingly, receiving fewer than 13% of votes cast. The measure was placed on the ballot by a left-of-center pro-abortion group called Clean Yield Asset Management, which placed similar measures on the ballot at FedEx and Cigna, where they were also defeated.
The proposal called upon Walmart to "publish a report on the potential risks and costs to the company of state policies that restrict reproductive healthcare…" Reproductive health care being a common euphemism for abortion. The call for a study of risks is a standard form used by activists to influence companies in their preferred direction. There is a precedent of the SEC upholding proposals of this format as appropriate topics for shareholder votes.
The proposal reads in full:
“RESOLVED: Shareholders request that Walmart Board of Directors issue a public report prior to December 31, 2022, omitting confidential and privileged information and at a reasonable expense, detailing any known and any potential risks and costs to the Company caused by enacted or proposed state policies severely restricting reproductive rights, and detailing any strategies beyond litigation and legal compliance that the Company may deploy to minimize or mitigate these risks.”
Another standard tactic is to call upon companies to study the "risk" of whatever social policy the activist opposes, without also calling for a study of the benefits of that policy. For example: abortion kills future customers. Pro-choice groups which have proposed ballot items like this do not propose that the companies study the negative business effects of abortion-on-demand, which are considerable and increasingly obvious during a time of when the population is rapidly aging, social security and pension plans are strained, and there is a labor shortage. Also left out of the equation is any reference to the risk of backlash from the public or from workers for injecting itself into a highly contentious political debate. Public backlash is clearly growing against CEOs swerving out of their lane and into politics, with strong majorities of both Democrats and Republicans opposing such incursions into hot-button issues.
The proposal suggested that Walmart might have trouble recruiting workers in Arkansas should Roe v. Wade be reversed and abortion outlawed, though no argument was offered regarding the alleged connection between pro-life policies and a worker shortage in the bargain retail sector. The proposal calls upon the company to speak to the issues of “any effects on employee hiring, retention, and productivity, and decisions regarding closure or expansion of operations in states proposing or enacting restrictive laws and strategies such as any public policy advocacy by the company, related political contributions policies, and human resources or educational strategies.” This amounts to a suggestion that the company threaten to punish states by closing (or not expanding) business in those states, a tactic which has been used effectively against states which passed religious freedom laws at odds with the desire of the LGBTQ lobby. And clearly the proposal is targeting support for pro-life politicians via the proxy process, which is also a common tactic from left-of-center groups.
T.J. Maxx had a similar abortion related proposal on the ballot on June 7th, put forth by a different group of activists. It was also defeated.
Jerry Bowyer is financial economist, president of Bowyer Research, and author of “The Maker Versus the Takers: What Jesus Really Said About Social Justice and Economics.”