It was another bad earnings report from Dick’s Sporting Goods, coming almost six months after the National Center’s Free Enterprise Project (FEP) first warned CEO Ed ...
Launched in 2007, the National Center for Public Policy Research’s Free Enterprise Project focuses on shareholder activism and the confluence of big government and big business. The Free Enterprise Project (FEP) is the conservative movement’s only full-service shareholder activism and education program: It files shareholder resolutions, engages corporate CEOs and board members at shareholder meetings, petitions the Securities and Exchange Commission (SEC) for interpretative guidance, and sponsors effective media campaigns to create the incentives for corporations to stay focused on their missions.
As the leading voice for conservative-minded investors, FEP annually files more than 90 percent of all right-of-center shareholder resolutions. Dozens of liberal organizations, however, annually file more than 95 percent of all policy-oriented shareholder resolutions and continue to exert undue influence over corporate America.
Through the years, FEP has been a leading voice for the conservative investor on a divergent range of topics including: health care, immigration, gun rights, energy, taxes, subsidies, regulations, religious freedom, food policies, media bias, gun rights, federalism, corporate free speech, ideological diversity, voter integrity, freedom of conscience, property rights, workers’ rights and other important public policy issues.
The Free Enterprise Project is also the nation’s leading program for confronting liberal shareholder activism.
In 2012, Justin Danhof, Esq. was appointed as the Director of the Free Enterprise Project. Since that time, he has filed dozens of shareholder resolutions and attended over 100 shareholder meetings carrying a sharp spear for liberty. As Wall Street Journal columnist Kimberley Strassel notes in her 2016 political bestseller, The Intimidation Game: How the Left is Silencing Free Speech, “If you’ve never been to a corporate shareholder meeting, you’ve likely never heard of Justin Danhof. If you ever have been to one, you’ll likely never forget him.” Strassel spent a full chapter in her book detailing Danhof’s shareholder activism and fight for liberty.
Mr. Danhof’s legal expertise has come in handy during the filing of shareholder resolutions. Corporations often hire outside attorneys from the nation’s leading law firms and petition the U.S. Securities and Exchange Commission seeking to vacate our proposals. Companies often accrue six-figure legal bills fighting FEP proposals. Danhof single-handedly takes on these white-shoe law firms and regularly defeats lawyers that singly-handedly earn 30-times more per year than FEP’s entire annual budget.
In some years, Danhof has had a 66 percent success rate – a ratio that is relatively unheard of in front of the corporate-friendly judges at the SEC.
Since 2012, Danhof has participated in over 100 shareholder meetings to advance free-market ideals in health care, energy, taxes, subsidies, regulations, religious freedom, food policies, media bias, gun rights, workers’ rights and other important public policy issues.
Danhof’s work has generated a tremendous amount of media coverage.
FEP's questioning of Boeing's and General Electric's support for the Clinton Foundation helped trigger an FBI investigation into the Foundation's activities.
FEP's Employee Conscience Protection Project strengthened protections for the political beliefs and activities of over five million workers at 13 major U.S. corporations.
Just days after FEP's questioning of Disney CEO Bob Iger over biased commentary at Disney-owned ESPN generated significant media, including coverage by The Washington Post, the Los Angeles Times, Reuters, USA Today, and Fox Business, ESPN issued new guidelines for political commentary by its on-air talent.
After Danhof questioned Facebook CEO Mark Zuckerberg about the company's anti-conservative bias in its news feeds, the company changed its policy by removing humans in place of a more neutral algorithm.
Time Warner CEO Jeff Bewkes vowed to earn our trust after being chastised by FEP over CNN's proclivity for media bias and fake news. He promised to recommit to independence. Two weeks later, CNN fired three reporters involved in a false report about Anthony Scaramucci.
CNBC's Jim Cramer, Investor's Business Daily, and Motley Fool all questioned the wisdom of continued investment in Apple after CEO Tim Cook announced at an annual meeting that he didn't care about ``bloody ROI (return on investment).`` His statement came in response to questioning by our FEP over the company's support for regulation.
FEP personnel have been repeatedly ushered into private meetings with CEOs of some of the largest corporations in the world, such as PepsiCo.
After FEP appealed directly to then-CEO Alan Mulally to withdraw Ford from the U.S. Climate Action Partnership, a group that lobbies for stringent greenhouse gas regulations, Ford dropped its membership.
After FEP filed a shareholder proposal with General Electric over the company's foray into alternative energy programs, the company agreed to amend its corporate policies to only engage in green energy initiatives if the executives could identify a legitimate business purpose.
Under pressure from FEP, Google dropped its ``Renewable Energy Cheaper than Coal`` campaign and also eliminated its ``green czar`` position.
Since 2012, the Free Enterprise Project has generated more than 10,000 mediacitations. FEP work has been cited or published by outlets such as the Wall Street Journal, the New York Times, Washington Post, the Boston Globe, the Los Angeles Times, the San Francisco, Chronicle, Dallas Morning News, USA Today, Variety, the Associated Press, Bloomberg, Drudge Report, Business Insider, Investor’s Business Daily, Time, Fortune, the Rush Limbaugh Show, National Public Radio, SiriusXM, CBS News, the Fox News Channel, the Fox Business Channel, NewsMaxTV, One America News Network and hundreds more.
“The National Center for Public Policy Research’s Justin Danhof once noted: ‘Corporations that cave to the left only place a bigger target on their backs.’ … Danhof has it right.”
-John Merline of Investor’s Business Daily detailing FEP’s work
Los Angeles Times (2013)
“Robert Iger faced tough questioning about alleged liberal bias at Disney-owned ABC News and ESPN… Iger conceded… “making mistakes.”
– Daniel Miller on Justin Danhof’s questioning of Disney CEO Robert Iger
Motley Fool (2013)
“I… suggest that investors refrain from buying shares of Walgreens until… [he] can provide a solid answer.
– Motley Fool’s Gene Kropowski pressing Walgreens’ CEO Greg Wasson to answer Free Enterprise Project Director Justin Danhof’s question on whether low prices or sustain- ability are the higher priority
San Francisco Chronicle (2016)
“[UC Davis professor Leticia] Saucedo thinks the Free Enterprise Project’s campaign is a good idea…”
-A labor law professor endorses our “Freedom of Conscience” shareholder proposal
[The Free Enterprise Project] is turning the shareholder resolution process into a tool for shaming companies for taking on climate change. It’s a turnabout of the tactic long used by environmental activists…think of it as Greenpeace standing on its head.”
“Led by the National Center for Public Policy Research, [conservatives] are starting to imitate the liberals’ tactics by sponsoring initiatives at corporate board meetings… to act as a counterweight… [and] push conservative causes such as lower taxes and smaller government.”
June 30, 2017
By Justin Danhof, Esq.
The law of unintended consequences explains away outcomes difficult to see at the beginning of specific and well-intended actions. In the realm of politics, however, some results are so obvious that politicians should not be allowed to fall back on this age-old excuse.
Legislation to replace the Dodd-Frank banking regulation that recently moved to the Senate is an example of well-intentioned lawmaking with foreseeable flaws.
Currently known as the Financial Choice Act, it goes far beyond curtailing the overreaches of Dodd-Frank. Passed by the House in early June, it contains an unrelated provision slipped in by House Financial Services Chairman Jeb Hensarling, R-Texas, to dramatically alter the shareholder resolution process.
It would change the current minimum ownership threshold for filing a resolution from $2,000 to 1% of a company’s outstanding stock. This would move the threshold for filing a proposal with General Electric, for example, from $2,000 to $2.4 billion.
It’s like using a fire hose to put out a birthday candle.
Hensarling’s provision appears to be designed to curb the influx of liberal proposals targeting businesses over largely ginned-up environmental, social and political causes. Last year, nearly 1,000 shareholder proposals were filed, with about 500 focused on governance matters and 400 related to environmental and social issues. The overwhelming majority of these proposals came from left-leaning groups.
But there are productive conservative proposals, too. For example, after Mozilla CEO Brendan Eich was run from his job for supporting California’s traditional marriage ballot initiative, the National Center for Public Policy Research’s Free Enterprise Project used shareholder proposals to protect more than 5 million workers at more than a dozen publicly traded companies from a similar unfair fate. Each year, that effort, known as the Employee Conscience Protection Project, extends workplace protections to more and more American workers.
The National Center’s Free Enterprise Project is the nation’s only right-of-center effort that focuses on shareholder activism as a means of increasing liberty. Most conservative groups are well-equipped at exposing the freedom-reducing elements of government. The Free Enterprise Project, however, points out that government actors often work in concert with business on such efforts.
That’s one reason why the group recently used shareholder proposals to ensure graduates of more than 200 religious universities that refuse to follow President Obama’s mixed-gender bathroom edict are not discriminated against in hiring or employment. They proactively got corporations to oppose the Obama Administration’s authoritarian power grab.
The Choice Act’s apparent goal of reducing liberal agitation of corporate America may be noble, but be forewarned that the strategy laid out in the Financial Choice Act would likely have the opposite effect.
Changing shareholder resolution rules would reduce the total number of left-wing proposals appearing on corporate proxy statements, but it might also increase the clout and potential impact of those liberal proposals meeting the new threshold. And the left will indeed meet the new threshold.
The left already has vast resources in place to counter the new rules. From state employee pension funds; to “socially responsible” investment funds; to trade unions; to wealthy allies such as Warren Buffett, Tom Steyer and Bill Gates; the left will meet this new challenge with vigor.
In trying to reduce the progressive voice, the Financial Choice Act may instead hand the left a shiny new megaphone. While emboldening the left, it would eviscerate conservative shareholder resolution efforts.
Beyond missing its desired effect, changing in shareholder proposal process would be an optics nightmare. Liberal groups already claim it is a conservative handout to big business. On the surface, that complaint has merit.
But conservatives would also do well to remember just how “big business” has treated them.
Big pharmaceutical companies and big health insurers were largely responsible for ObamaCare. Tech titans such as Apple and Salesforce worked to derail religious freedom efforts at the state level. Industry leaders such as Amazon and Starbucks teamed up to oppose President Trump’s executive orders on travel and immigration.
Employing dramatically less resources than the left, the Free Enterprise Project used shareholder proposals to fight back against the above-listed corporate assaults on conservative and religious Americans. The Free Enterprise Project pressured insurers against taking massive taxpayer bailouts through certain ObamaCare provisions.
Congress followed up to limit the taxpayer largesse to major health insurers. And when companies such as Apple, Coca-Cola and General Electric worked to thwart religious freedom in the United States by falsely claiming that such efforts discriminate against the LGBT community, they faced Free Enterprise Project resolutions exposing these corporate hypocrites since they all do business in regions that criminalize homosexual behavior.
If Senate conservatives pass the Financial Choice Act under the auspices of trying to reduce the influence of socially-minded liberal organizations, they shouldn’t be allowed to get away with claiming “unintended consequences” when those exact groups end up with even more power over corporate America.
In warning his colleagues that the Independent Counsel Act would be disastrous for the nation, former Supreme Court Justice Antonin Scalia quipped that some issues come to the Court clad in “sheep’s clothing … (but) this wolf comes as a wolf.” The Financial Choice Act’s proposed change to the shareholder resolution process is a wolf. The Senate is warned.
June 6, 2016
By Justin Danhof, Esq.
The famous villain of McDonald’s, the Hamburglar, would attempt to rob Ronald, Grimace and other company favorites of their beloved burgers—always unsuccessfully.
Bad news: The Hamburglar is back, in a new guise, and he’s after more than burgers.
The new Hamburglar is a coalition of left-wing activist groups supported by a reported $15 million in grants from the Service Employees International Union.
The SEIU’s motive is no secret: Higher minimum wages lead to more union revenue. McDonald’s is targeted because it’s big, it’s mainstream and it’s not clear management has the will to fight.
A concession by McDonald’s could make $15 an hour the new, reasonable figure for a minimum wage, or so the activists figure.
As big as McDonald’s is, the SEIU’s goals are bigger.
What’s new about this battle is that the wage “negotiations” aren’t traditional labor negotiations at all. They are protests designed to make it seem as though $15 an hour is a legitimate starting wage in every jurisdiction, regardless of economic conditions or the skill needed in a particular job. Indeed, the plan is to make mainstream the idea that any pay under $15 an hour represents a social injustice.
Already the activists credit their protests as a reason why city officials in Chicago, San Francisco and Los Angeles agreed to new wages of $13 and $15 an hour for some public employees.
And that’s why SEIU-sponsored activists are unmoved that fast-food restaurants will increase automation and reduce hiring if the minimum wage becomes $15. They don’t fret over the loss of jobs in an industry in which many employees aren’t in their union, if wages go up in unionized sectors.
The activists’ target is much larger than one restaurant chain. And as such, if McDonald’s gives in, the repercussions will be felt throughout the economy.
That’s why we at the National Center for Public Policy Research filed a shareholder resolution encouraging the company to steel its spine against repeated attacks from the left.
Our proposal highlighted instances in which McDonald’s strayed from free-enterprise principles, possibly at the behest of activists. The issues raised in our presentation were borne out at the company’s annual shareholder meeting May 26 in Oak Brook.
For example, last year, McDonald’s management gave into liberal protesters and boasted about increasing the minimum wage for some workers. This year, even more protesters demanded additional wage increases.
Earlier, McDonald’s surrendered to a liberal pressure campaign and ended its association with the American Legislative Exchange Council—a four-decade-old organization of state legislators who believe in free enterprise. Was McDonald’s praised for its surrender? No. Instead, the activists attacked the company’s membership in the National Restaurant Association, which believes the market should set wages.
Our main message to McDonald’s specifically, and to corporate America generally, is this: Don’t give liberal activists an inch because they then will demand a mile. Appeasing the SEIU and its grantees only increases the likelihood that they will be back, demanding more.
And there is a lot more at stake than a basket of burgers.
February 28, 2018
By Justin Danhof, Esq.
Liberals in need of patsies to carry their water need look no further than the nearest Fortune 500 company these days, and conservatives continue to give these big businesses a pass at their peril.
Corporate America has become the muscle of American liberalism. While it was once considered orthodoxy that big business and conservatives marched in lockstep because of shared views on macroeconomic policy — that’s now a bygone. And conservatives have no one to blame but themselves.
The most recent example of this shift occurred following the recent shooting at a high school in Parkland, Florida. After a deranged former student murdered 17 students and staff, liberal media elites predictably blamed gun rights advocates. CNN and others directed their ire at the National Rifle Association. And they were soon backed up by corporate America in their demonization of the organization.
Companies have rushed to punish the NRA for supporting the Second Amendment. Delta Airlines cancelled a group travel discount for NRA members. United Airlines also cancelled a discount for travel to the NRA annual meeting. The First National Bank of Omaha ended a co-branded NRA credit card. Symantec ended multiple discount programs for NRA members. Rental car companies Hertz, Enterprise and Avis Budget also ended their relationships with the NRA. And the list of is still growing.
It’s an all too common pattern. Liberal politicians and the media take up a cause. Left-wing activist groups mobilize to pressure corporations. Corporate America joins the fray, and their support is used to bolster and justify the cause. It’s a circular echo chamber, but it’s effective.
For example, after President Trump issued his initial immigration order in January 2017, companies far and wide allied with the media to condemn Trump as racist. Apple, Uber, Facebook, Microsoft, Google and a host of other companies added their voices and economic heft to the resistance. Amazon even offered up legal support to fight Trump’s efforts to protect American citizens. Liberal elites touted the corporate backlash. The Trump administration issued amended orders (later upheld in court).
Following the passage of HB2 in North Carolina in 2016 — the law requiring men to use the men’s room and women to use the women’s room in public places — companies such as PayPal, Pepsi, Red Hat and Nike worked tirelessly to defeat it. The National Basketball Association and the National Collegiate Athletic Association cancelled events in the Tar Heel State. Liberal elites touted the corporate backlash. HB2 was repealed.
Also in 2016, when Georgia’s legislature passed a religious freedom law, businesses such as Coca-Cola, Viacom, Unilever and Delta rallied with anti-religious media members who falsely claimed it persecuted the LGBT community. Disney, AMC Networks and the National Football League made economic threats against the Peach State if it enacted the legislation. Liberal elites touted the corporate backlash. Governor Nathan Deal succumbed to those threats and vetoed it.
These examples are instructive and far from unique. Corporate leaders are generally far more amenable to outside pressure than politicians. Liberals know this and have employed tremendous resources to influence corporate behavior over decades.
As the director of the nation’s only right-of-center full-service shareholder activist organization — the National Center for Public Policy Research’s Free Enterprise Project (FEP) — I witness liberal activists wag the tail of the corporate dog with almost no pushback. Corporate leaders I engage with remark such liberal orthodoxy often goes unquestioned and unchallenged.
In a world where the squeaky wheel gets the grease, conservatives don’t make a peep.
By and large, conservative Americans leave business alone because they realize private enterprise drives the economic engine that keeps America thriving. However, as corporate America continues to join with the left to erode constitutional protections and traditional beliefs that conservatives hold dear, silence is no longer an option.
At the Free Enterprise Project, we have confronted many of the major corporations that challenged Trump’s travel orders on immigration, opposed North Carolina’s HB2 law and those that opposed religious freedom protections. Using shareholder resolutions and questioning CEOs directly at annual shareholder meetings, we have ripped a page from the left’s playbook and are having an impact. However, the playing field is still unevenly stacked in favor of liberal activist investors.
Conservatives that are offended by corporate America’s recent attacks on the NRA can push back just as we do at the Free Enterprise Project. NRA members and 2nd Amendment supporters should contact United, Delta, Hertz and every company that has disengaged and ended their relationship with the NRA. Executives need to hear from critical voices, not just praise from the mainstream media for kowtowing to the demands of the left.
The threshold to attend an annual meeting of a publicly-traded company is a single share of stock. Through retirement funds and other investments, millions of Americans have the right to directly confront corporate bad actors and may not even realize it. At FEP, we have proven that confronting CEOs face-to-face can have tremendous results.
Most conservatives wrote off finding ideological balance at our nation’s colleges and universities long ago, ceding campuses to the left. If conservatives do the same with corporate America’s leftward lean, the boardroom will soon be little more than an extension of the academy. That’s the cost of silence.