Notionally, Grant was the person who coined the term “lobbyist” to describe these people, who, one supposes, were slightly irritating. I’m not sure – and yes I am dropping a clanger here – why Grant frequented the lobby when everybody knows that the Willard has a fabulous bar called the Round Robin, where I have happened on various occasions to have spent huge sums of money on very small amounts of alcohol.

Yet, in the American political system, lobbyists do have an enormous influence, and companies are often asked how much they spend on lobbying. Google, for example, paid around $2-million in the year 2007 for lobbyists; a decade later this had exploded to $20-million a year (just a sliver, of course, of last year’s revenue which reached R280-billion).

In total, around $4-billion a year is spent on lobbying in the US, but this number has been more or less static for at least a decade now. Defenders of lobbying in the US make the point that for every lobbyist on one side of an issue, there is another fighting for the other side. It actually helps politicians to crystalise all the arguments. Lobbyists, it turns out, are a bit like nuclear warheads; you have them because your opponents have them.

Detractors of the lobbying system worry that because politics is becoming such an enormously expensive process, lobbyists are becoming much more powerful because they tend to guide the flows of cash to candidates who support their causes. But there is one good thing about the US system: we do know, more or less, how much is being spent by those lobbying politicians. In the rest of the world, SA included, not so much.

To try and rectify this problem, the organisation Just Share, in partnership with Aeon Investment Management and the NGO Fossil Free South Africa, has tabled a whole host of shareholder resolutions trying to force companies to disclose what they spend on lobbying political parties and associated groups on the subject of climate change.

This week, Just Share disclosed that the largest coal producers, Thungela and Exxaro, have declined to table climate lobbying resolutions at their respective AGMs. The same kind of resolution has been filed for the past five years at Sasol’s AGM but turned down each time.

My first instinct is that this is kinda outrageous. But the reality is that the companies may actually be acting according to the specifics of the law, which broadly works like this: the rights of shareholders are very prescribed to a small number of very specific functions, among them are appointing directors and agreeing on how much they should be paid. If shareholders don’t like what directors are doing, their natural course of action would be to change the directors, and/or invest in a different company.

The danger, notionally, is that shareholders shouldn’t usurp the powers vested in the board of directors to manage the business, except where the company’s memorandum of incorporation (MOI), or the Companies Act, specifies it. The analogy is comparable to a ship: shareholders can replace the captain, but while the captain is on deck, they shouldn’t interfere with the actual sailing process because there is a risk that would sink the damn boat. 

It’s actually not a bad principle. But there is a counter-argument that these particular resolutions don’t prescribe action outside of disclosing what is being spent by their company on lobbying. It’s not like they are sticking their oar into how the company is run, day to day. And there are loads of regulations, both statutory or by convention, or specified in the MOI, requiring companies to report on certain issues, so why not add lobbying expenditures to the list? It’s all part of the modern virtue of transparency and disclosure.

Just Share argues more specifically that Section 7 of the Companies Act 71 says that this legislation must be interpreted in a manner that promotes compliance with the Bill of Rights in the Constitution. And both of those documents do in generic terms encourage transparency and high standards of corporate governance. Obvs.

What is more, the Paris Agreement on Climate Change, of which SA is a signatory, also addresses the issue of companies lobbying against climate change and likewise encourages transparency.

I suspect what is happening behind the scenes is that advocates promoting awareness around the threat of climate change have been through the wringer because they very obviously have a scientifically demonstrable case, and yet, getting companies and governments to act is proving extremely difficult. And they suspect that at least one of the reasons for resistance is that companies, like, say, coal companies, are heavily lobbying politicians to go easy on smashing down the legislative hammer.

That may be true, to a certain extent. But I suspect there are other issues at play too, one of which is that it’s very difficult to fundamentally change your business model. I sometimes get the feeling that climate activists, in their righteousness, are not fully conscious of exactly the dimentions of what they are asking. And of course, it doesn’t help that these coal companies are currently making an absolute fortune at the moment.

Personally, I think that standing on strict legal principles on this issue is just making Exxaro and Thungela look a bit silly. The resolutions are not overly onerous, and they are consistent with the direction of modern corporate law even if there is no specific legal requirement at this time. It’s not like the resolutions would condemn the company to immediately operate in a totally different way – although some others might have. I suspect South Africans would actually be surprised by how little corporate SA spends on lobbying, but I may be wrong.

And, by the way, Google seems to be doing fairly well even though it discloses its lobbying expenditure. In fact, they are making out like, well, coal companies.

Just by the way, if this subject interests you, as trust me it should, may I encourage you to sign up for The Gathering: The Earth Edition where all of this will be discussed in the sprightly tradition of these annual Daily Maverick events. It takes place on May 26th in Cape Town; the speaker’s list has just been released and it includes some really big names, including former Eskom CEO Andre de Ruyter. To book, go here.

Good Investing,

Tim Cohen