Emerson participates in the political and public policy process through our federal political action committee (PAC), the “Emerson PAC”, our “Missouri PAC”, the Emerson Missouri Responsible Government Fund, and, occasionally and as permitted by law, direct Company contributions. Emerson and the Emerson political action committees are non-partisan.
All contributions from either the PACs or from our company are made solely on the basis of issues of importance to our company, our employees and our shareholders. Contributions are made to support pro-manufacturing, pro-business and pro-economic growth policies, and specifically include trade, taxes, energy, healthcare, environment and legal liability, to name but a few. In making contribution decisions, both the Company and the PAC boards consider the views, quality and effectiveness of the candidate, organization or cause, and whether the candidate or cause is likely to succeed. They also review organizations and individuals associated with proposed recipients to determine whether the positions taken by those organizations or individuals could be inconsistent with Emerson's interests.
As part of its oversight role for Company political activities, the Board Corporate Governance and Nominating Committee oversees policies and practices related to the Company's political spending. The Committee approves an annual contribution limit on expenditures to support state and local political candidates, as well as those for campaigns, ballot issues and bonds. The annual contribution limit is $1,000,000. The Committee receives a report annually on all of the Company's political spending.
All Company political expenditures are initially reviewed by Emerson's government affairs office in Washington, D.C. Proposed contributions are then reviewed by the office of the General Counsel to assure legal compliance. Final authorization is required from the Chief Executive Officer.
The Company provides no direct support to federal candidates, because U.S. law prohibits companies from contributing to candidates for federal office. However, in states where corporate contributions are permitted by law, Emerson may make contributions to state and local candidates and ballot issues of importance to our company or may make such contributions from the Missouri PAC. Any contributions to candidates or ballot issues from the Company are subject to reporting by the recipient candidate or ballot issue committees, pursuant to the laws of the state or locality where the committee is formed. For fiscal 2016, Emerson contributed a total of $99,000 to state and local political candidates, and federal, state and local campaigns and ballot and bond issues, including $89,000 contributed to the Missouri PAC. The recipients and amounts of those contributions are detailed in our Political Contributions Report.
The Emerson PAC supports federal candidates and committees, as well as other candidates and party organizations where permitted by law, through voluntary, after-tax contributions by Emerson employees and retirees who choose to pool their resources in the Emerson PAC to support candidates who share the values and goals of the Company.
The Federal Election Commission (FEC) regulates activities of the Emerson PAC. All current and prior election cycle contributions to and from the Emerson PAC are reported to the FEC and are available on its website at http://www.fec.gov/fecviewer/CandidateCommitteeDetail.do by searching for “Emerson”. Contributions to the Emerson PAC in calendar year 2016 totaled approximately $240,000 and disbursements totaled approximately $225,000. Emerson PAC expenditures are provided in our LD-203 reports described below.
The Missouri PAC is supported by Company contributions to support candidates in Missouri, as well as party organizations where permitted by law. In fiscal 2016, Emerson contributed $89,000 to the Missouri PAC. A list of contributions to and from the Missouri PAC is available on the Missouri Ethics Commission website at http://mec.mo.gov/mec/Campaign_Finance/CF11_SearchComm.aspx by entering “Emerson” for the committee name. The Missouri PAC made $115,500 in total contributions during fiscal 2016. Contributions by the Missouri PAC during fiscal 2016 in excess of $5,000 were as follows:
Missouri Republican Party - $25,000
Koster for Missouri - $25,000
Greitens for Missouri - $25,000
Friends of Todd Richardson - $8,500
Missouri Ethics Commission reports for the last 18 months can be viewed at the following links:
Missouri PAC Quarterly Report – January 2016
The Emerson Washington, DC office generates a list of candidates these PACs can support based on the PAC giving criteria, requests from third parties and suggestions from PAC members. Outside legal counsel then conducts a review of proposed disbursements. Separate boards made up of Emerson employees set overall contribution budgets and approve all contributions by each PAC. The PAC boards retain counsel to ensure compliance with applicable laws and regulations. Each PAC undergoes an independent annual audit and legal review.
Statement of corporate governance, revised effective October 4, 2016, reviewed as of June 5, 2017.