WHEREAS, we believe in full disclosure of McKesson’s direct and indirect lobbying activities and expenditures to assess whether McKesson’s lobbying is consistent with its expressed goals and in stockholders’ best interests.

RESOLVED, The stockholders of McKesson request the preparation of a report, updated annually, disclosing:

1. Company policy and procedures governing lobbying, both direct and indirect, and grassroots lobbying communications.

2. Payments by McKesson used for (a) direct or indirect lobbying or (b) grassroots lobbying communications, in each case including the amount of the payment and the recipient.

3. McKesson’s membership in and payments to any tax-exempt organization that writes and endorses model legislation.

4. Description of the decision-making process and oversight by management and the Board for making payments described in section 2 and 3 above.

For purposes of this proposal, a “grassroots lobbying communication” is a communication directed to the general public that (a) refers to specific legislation or regulation, (b) reflects a view on the legislation or regulation and (c) encourages the recipient of the communication to take action with respect to the legislation or regulation. “Indirect lobbying” is lobbying engaged in by a trade association or other organization of which McKesson is a member.

Both “direct and indirect lobbying” and “grassroots lobbying communications” include efforts at the local, state and federal levels.

The report shall be presented to the Governance Committee and posted on McKesson’s website. 

Supporting Statement

We encourage transparency in McKesson’s use of funds to lobby. McKesson spent $18.1 million on federal lobbying from 2010 – 2018. This figure does not include state lobbying, where McKesson also lobbies but disclosure is uneven or absent. For example, McKesson spent $1,365,402 on lobbying in California from 2010 – 2018. McKesson’s lobbying and membership in the Healthcare Distribution Alliance (HDA) has drawn attention.[1]

McKesson is a member of the Business Roundtable and the HDA, which together spent over $45.6 million on lobbying in 2018 and 2019. McKesson does not disclose its payments to trade associations, or the amounts used for lobbying. McKesson restricts its trade associations from using its payments for political contributions, but this does not cover payments used for lobbying. This leaves a serious disclosure gap, as trade associations generally spend far more on lobbying than on political contributions.  And McKesson does not disclose its payments to tax-exempt organizations that write and endorse model legislation, such as supporting the American Legislative Exchange Council (ALEC).

We are concerned that McKesson’s lack of lobbying disclosure presents significant reputational risk. For example, McKesson’s lobbying over opioids has attracted negative media scrutiny.[2] And McKesson has drawn scrutiny for signing the BRT Statement on the Purpose of the Corporation, yet also attending the ALEC annual conference.[3] McKesson uses the Global Reporting Initiative (GRI) for sustainability reporting, yet currently fails to report “any differences between its lobbying positions and any stated policies, goals, or other public positions” under GRI Standard 415.

[1] https://www.politico.com/story/2018/05/08/opioid-epidemic-drugs-congress-hearings-573224

[2] https://www.nytimes.com/2019/04/22/health/opioids-lawsuits-distributors.html

[3] https://readsludge.com/2019/08/27/these-ceos-promised-to-be-socially-responsible-but-their-companies-are-pushing-alecs-right-wing-agenda/