Sallie Mae, the United States’ largest student lender, got a wake-up call at its annual meeting on June 25, when more shareholders voted “for” than voted “against” the AFL-CIO’s stockholder proposal, calling for full disclosure of all company spending on lobbying in Washington, D.C., and each of the 50 states.
“Sallie Mae and Navient [the Sallie Mae spin-off company managing student loans for the U.S. Department of Education] cannot afford to hide their lobbying,” said James Gilbert, director of the AFL-CIO’s Union Veterans Council and a veteran of the U.S. Navy.
Both companies that are constantly in the public eye. Just a month ago, for example, the Justice Department and the Federal Deposit Insurance Corporation alleged that Sallie Mae had violated the rights of more than 60,000 men and women in our Armed Forces. Sallie Mae charged them interest on their loans in violation of the Servicemembers Civil Relief Act. The Justice Department said that Sallie Mae had even gone to court to win default judgments against the men and women who defend our country. While they were protecting America, Sallie Mae was attacking their credit records.
More than 58% of Sallie Mae shareholders who voted “for” or “against” the lobbying disclosure proposal supported the AFL-CIO’s proposal. Sallie Mae, however, counted all the votes of shareholders who abstained from voting as votes against the AFL-CIO’s proposal. Sallie Mae announced that “Stockholders did not approve the stockholder proposal regarding disclosure of the Company’s lobbying expenditures and contributions.”
According to the policy of the Council of Institutional Investors: “Boards should take actions recommended in shareowner proposals that receive a majority of votes cast for and against.”
Sallie Mae should take note.