Political Contributions

2010 – Corrections Corp. of America

 

 

RESOLVED:  the shareholders of Corrections Corporation of America hereby request that our Company provide a report, updated semi-annually, disclosing our Company’s:

 

1. Policies and procedures for political contributions and expenditures, both direct and indirect, made with corporate funds.

2. Monetary and non-monetary political contributions and expenditures not deductible under section 162(e)(1)(B) of the Internal Revenue Code, including but not limited to contributions to or expenditures on behalf of political candidates, political parties, political committees and other political entities organized and operating under 26 USC Sec. 527 of the Internal Revenue Code and any portion of any dues or similar payments made to any tax exempt organization that is used for an expenditure or contribution if made directly by the corporation would not be deductible under section 162(e)(1)(B) of the Internal Revenue Code.  The report shall include the following:

 

a. An accounting of our Company’s funds that are used for political contributions or expenditures as described above;

b. Identification of the person or persons in our Company who participated in making the decisions to make political contribution or expenditure; and

c. The internal guidelines or policies, if any, governing our Company’s political contributions and expenditures.

 

This report shall be presented to the Board of Directors’ audit committee or other relevant oversight committee and posted on our Company’s website to reduce costs to shareholders.

 

Supporting Statements: As long-term shareholders of Corrections Corporation, we support transparency and accountability to corporate spending on political activities.  A significant number of investors agree.  In the three years our resolution has been on the ballot, the vote has grown from 23.8% to 26.6% to 31.19% of shares voted in support of our request. 

 

The activities, for which we seek transparency and accountability, include direct and indirect political contributions to candidates, political parties or political organizations; independent expenditures; or electioneering communications on behalf of a federal, state or local candidate.    

 

Disclosure is consistent with public policy, in the best interest of the company and its shareholders, and critical for compliance with recent federal ethics legislation.  Absent a system of accountability, company assets can be used for policy objectives that may be inimical to the long-term interests of and may pose risks to the company and its shareholders.

 

Relying on publicly available data does not provide a complete picture of the Company’s political expenditures.  For example, the Company’s payments to trade associations used for political activities are undisclosed and unknown.  In many cases, even management does not know how trade associations use their company’s money politically.  The proposal asks the Company to disclose all political contributions, including payments to trade associations and other tax-exempt organizations.  This would bring our Company in line with a growing number of leading companies, including Dow Chemical and Aetna that support political disclosure and accountability and present this information on their websites.

 

The Company’s Board and shareholders need complete disclosure to be able to fully evaluate the political use of corporate assets. We urge your support for this critical governance reform.