Posts tagged with: Corporations law

t873In a 5-4 decision, the Supreme Court just announced its ruling in favor of Hobby Lobby, holding that, “as applied to closely held corporations, the government’s HHS regulations imposing the contraceptive mandate violate the Religious Freedom Restoration Act of 1993 (RFRA).” The full opinion, written by Justice Samuel Alito, can be read here.

Although there is still much to digest, and although the majority opinion still leaves quite a bit of room for related battles to continue, it’s worth noting that that whatever perceived “narrowness” we see in the decision — confining things specifically to closely held corporations — remains a significant victory, particularly given our culture’s prevailing attitudes about business.

According to HHS, by simply incorporating one’s business in the pursuit of profit — “without in any way changing the size or nature of their businesses” — a company “would forfeit all RFRA (and free-exercise) rights” (quotes from Alito’s paraphrase). The arguments supporting such a view vary, including the principal argument advanced by HHS that corporations cannot “exercise religion.”

Alito dissects this from a variety of angles, and does so rather compellingly. But one of the more noteworthy sections is his refutation of the notion that for-profit corporations aren’t protected by RFRA because they “simply seek to make a profit.” (more…)

corporations_are_people_too_by_biotwist-d4hnskt[Note: “Argument Outline” is a new occasional series that provides summaries of religious, economic, and public policy arguments presented in the public square.]

The Religious Freedom Restoration Act (RFRA) states that government shall not substantially burden a person’s exercise of religion even if the burden results from a rule of general applicability, except in certain conflicts with a compelling governmental interest. That seems straightforward enough, but what does this law mean when it refers to a “person”? For instance, can a corporation like Hobby Lobby be a person under this Act?

Even some people who are sympathetic to Hobby Lobby’s fight to avoid being forced to violate their conscience may wonder if it makes sense to give such broad-based religious liberty protections to corporate entities. But in a recent article in the Harvard Law Review, Alan Meese and Nate Oman make the case that the most natural reading of the term ‘person’ in RFRA includes for-profit corporations, and why they should be afforded the same religious freedoms as individuals.

The following is a summary outline of the argument they present in this law review article:
(more…)

On January 31, the Interfaith Center on Corporate Responsibility issued a press release, announcing the organization’s “2013 Proxy Resolutions and Voting Guide.” A quick read of the release and ancillary materials, however, reveals that these resolutions have very little to do with issues of religious faith and everything to do with the progressive political agenda.

The ICCR guide “features 180 resolutions filed at 127 companies” that call on shareholders to “promote corporate responsibility by voting their proxies in support of investor proposals that advance social, economic and environmental justice.”

The ICCR boasts that “nearly one third” of this year’s resolutions (52) focus on lobbying and political spending, with the remainder aimed at “health care, financial and environmental reform.” The release ominously asserts: “Shareholders have a right to know whether company resources are being used to impact elections and public policy, including regulatory legislation.”

Whatsoever the ICCR resolutions have to do with the respective tenets of their member denominations is left to the readers’ imagination. (more…)

The Manhattan Institute’s Proxy Monitor project is aimed at “shedding light on the influence of shareholder proposals on corporations.” It provides a thorough analysis of proposals made from 2008 – 2011 by activist investors — and believe it or not, only 35 percent of those proposals were related to corporate governance. Most of the shareholder proposals that these companies deal with are attempts to direct the company in a more green or pacific or fair direction, and they come from small shareholders who do this to dozens of companies.

A new report from Manhattan summarizes the trends — the growing social proposals, and how Dodd-Frank has playing into activists’ activities — and the proxy monitor website allows you to look at any shareholder proposal from the last few years. The proposals are enlightening. The Sisters of Mercy of the Americas have submitted proposals to the stockholders of Lockheed Martin and General Dynamics stating,

WHEREAS: Space has served as a sanctuary where, over the years, nations cooperate rather than confront one another. Satellites save lives…

RESOLVED: Shareholders request that, within six months of the annual meeting, the Board of Directors provide a comprehensive report on Lockheed Martin’s involvement in the space-based weapons program, at reasonable cost and omitting proprietary and classified information.

The well-meaning Sisters of St. Francis of Philadelphia, in a proposal to McDonald’s shareholders that made the news earlier this year, requested that,

WHEREAS,

The Affordable Care Act, signed into law on March 23, 2010, included federal menu-labeling legislation requiring the posting of calories on fast food menu boards….

RESOLVED: Shareholders ask the Board of Directors to issue a report, at reasonable expense and excluding proprietary information, within six months of the 2011 annual meeting, assessing the company’s policy responses to public concerns regarding linkages of fast food to childhood obesity, diet-related diseases and other impacts on children’s health.

Many other equally well-intentioned proposals have been filed, including repeated requests by the Sisters of Charity of St. Elizabeth that various pharmaceutical companies restrain their prices to “reasonable levels.” The Unitarian Universalists have requested that Pepsi Co. “create a comprehensive policy articulating our company’s respect for and commitment to the Human Right to Water.”

This is not to mention the numerous environmental proposals made by religious groups, requesting that the Rights of Humanity and of Mother Earth not be violated by carbon emissions and by the use of genetically engineered plants. Take, for instance, this statement from a proposal to Du Pont’s shareholders, concerning genetically engineered crops:

The right to food requires that we place the needs of the most marginalized groups, including in particular smallholders in developing countries, at the centre of our efforts

One might think the Sisters of Charity of St. Elizabeth were unaware that it has been the genetic improvement of crops that has saved millions of the world’s poor from starvation.

We’ll keep you posted on further developments, and the effects these proposals may have on companies’ performance.