Political Support Policies & Procedures
Stakeholders, political organizations and others regularly approach us to support civic and political activities. Our board of directors and executive leadership encourage involvement in activities that advance the company’s goals and improve the communities where we work and live. To confirm alignment with our public policy objectives and business goals, we regularly review the scope of such activities.
A number of local, state, and federal laws govern corporate involvement in activities of a political or public policy nature. These statutes contain numerous prohibitions and detailed reporting and record-keeping requirements. They also contain enforcement provisions that carry civil and criminal penalties for noncompliance. Employees may be asked to participate in activities that fall under the jurisdiction of one or more of these statutes, but they are not reimbursed for, or coerced into, political activity.
The policies and guidelines below have been approved by the Public Policy Committee of the board and are intended to help ensure corporate compliance with these laws and regulations. With respect to political contributions, all such contributions will promote only the interests of ConocoPhillips, and not the personal political preferences of its company officers and executives.
The vice president, Government Affairs, is responsible for oversight of the company’s federal and state political activities, approval of the company’s corporate political expenditures, approval of the company’s trade association memberships and grassroots lobbying communications. The memberships and the expenditures allocated to lobbying, as reported by each organization, are annually reviewed with the Public Policy Committee of the board.
These policies and guidelines deal primarily with U.S. domestic political activity and are not intended to cover the many global political, legal and business issues that apply to U.S. corporations and their international affiliates. Other countries' rules and U.S. rules, such as the Foreign Corrupt Practices Act, are covered under other policies. Additionally, the policies and guidelines below only apply to situations where employees are asked to act on behalf of ConocoPhillips and do not apply to personal activities employees choose to fund or pursue at their own cost and on their own time.
In addition to undergoing a voluntary, internal assurance audit of the corporate political expenditures each year, the Public Policy Committee of the Board assesses our political policies and contribution criteria for alignment with our core values and in light of changes in federal, state and local lobbying and campaign finance laws and regulations. For the period January 1, 2020 through December 31, 2020 we adhered to our own code for corporate political spending.
Lobbying-related Activities – Trade Association Membership
We actively engage with trade associations at the national, state and local levels to collaborate on issues important to our industry. Participation with trade organizations also allows our company to access the association’s expertise in business, technical and industry best practices – an approach that is consistent with many of our peers and our investors. Our employees represent the interests of the company and the communities in which we operate through participation in committees and/or leadership roles in these associations. Employees who serve on trade association committees must work closely with Government Affairs, affected business units and Legal to maintain consistency with the company’s public policy positions and ensure compliance with any lobbying disclosure requirements.
Through participation in trade associations involved in lobbying, we seek to champion solutions that are practical, economical, environmentally responsible, non-partisan and in the best interests of the company. We feel it is important to be actively engaged with these organizations so that our positions on key issues for the company can be expressed. Association positions on public policy reflect a compromise of the assorted views of the membership. When trade association members have viewpoints that differ from ours on major initiatives affecting the company and its stakeholders, we work to promote a reasonable compromise. Our membership should not be considered a direct endorsement of the entire range of activities or positions undertaken by these organizations. We are one of many voices and our engagement with trade associations is not based on a single issue. We take positions contrary to those of trade associations when they are inconsistent with our own policy objectives. For example, many trade organizations we participate in have climate change positions aligned to ours. Where they do not, we have continued to offer our viewpoint and attempt to work with them to better align their position with ours. For example, while we are aligned with the broad climate change policy of the American Petroleum Institute (API), our position on the direct federal regulation of methane is different and we continue to work with API members on this issue. In the past year, we have also led or actively participated in several trade organization position updates and voted against or abstained from supporting specific actions requested by a trade organization. In addition, we have decided not to renew some memberships in 2020 because of misalignment on a number of policy topics, one of which is climate change. For a deeper look at how our public policy views align with major trade associations please see the association engagement section in Managing Climate-Related Risks.
The overview of the alignment of our national or international trade organization policies on climate change with our company’s is illustrative. We annually report on trade association memberships with payments in excess of $50,000. Trade association lobbying time and expense disclosures are highly regulated by the federal Lobbying Disclosure Act or state laws as applicable. Based on the reports received from the organizations listed, approximately 17 percent were used for lobbying purposes in 2020.
Lobbying Activities – Government Contacts
Federal, state and local statutes govern corporate lobbying activities. These statutes require activities and expenses associated with working legislative and regulatory issues be reported regularly and in prescribed ways. Contact with officials and other efforts to influence government action, including permitting or licensing of company operations, may constitute lobbying activities under various state and local laws.
We annually report on the amount of all federal and state lobbying activities, in compliance with federal filings. ConocoPhillips reported lobbying costs of $4,190,000.00 in 2020. This number includes:
- Salaries of all employees engaged in lobbying contacts or activities, based on a percentage of the employee’s time spent on those activities.
- Expenses for lobbying activities
- Payments to retained lobbyists.
- Overhead and office space associated with employees who engage in lobbying activities, based on a percentage of the employee’s time spent on those activities.
- The portion of our trade association dues that has been allocated to lobbying expenses by the trade association (as reported to us by each of the trade associations).
While the Federal Lobbying Disclosure Act exempts infrequent contacts with federal lawmakers, advance consultation with Government Affairs is essential to confirm the ground rules for these discussions and proper reporting. Consultation with Government Affairs is also required for contacts with state and local policymakers. This is especially important given the wide variation in state and local rules.
Additionally, ConocoPhillips employees should refrain from the following activities at the state or federal level without prior internal consultation and approval from Government Affairs.
- Testifying before a legislative or regulatory body.
- Agreeing to share in the costs of retaining a firm or individual to work a regulatory or a legislative issue.
- Agreeing to join an association or coalition whose purpose is to influence a regulatory or legislative issue.
- Lending ConocoPhillips’ name to any effort to endorse or oppose a pending legislative or regulatory issue.
For the past six months, as indicated in our U.S. government filings, our lobbying priorities have included:
- Methane emissions
- Operations and development
- Carbon pricing
These priorities are in alignment with our policies and positions, including our climate change public policy principles.
Gifts to Elected Officials, Regulators and Government Employees
Federal law prohibits registered federal lobbyists and those entities that employ federal lobbyists from providing gifts or anything of value to members of Congress or Congressional staffers. This includes appreciation gifts, items for display in his or her office, as well as tickets to sporting or other events. It also includes meals and lodging. While the rules provide for selected exceptions, great care is required to ensure compliance. Separate and similarly strict gift rules apply to the executive branch of the federal government. Additionally, states and localities have various types of gift rules, some with very strict gift prohibitions and reporting requirements.
Any gift to an elected official or government employee made on behalf of the company must comply with the applicable gift ban rules and receive prior approval from Government Affairs.
Grassroots activities are designed to supplement lobbying efforts by influencing officials to take favorable action on legislation or regulation important to the company. When appropriate, we will initiate calls to action targeted to our employees, which typically include the development and distribution of information and mobilization to contact policymakers or elected officials. In the same way, ConocoPhillips may expand grassroots activity and/or calls to action to include the general public, as deemed necessary on a case-by-case basis. All grassroots activities are based on collaboration between appropriate Government Affairs and business unit personnel.
ConocoPhillips has an advocacy website, Power in Cooperation, to support our positions on key legislative and regulatory issues. The website is a valuable tool for employees and other stakeholders, with comprehensive content about the safe development of natural gas and oil resources and how they are meeting the nation’s growing energy demands. The site offers extensive, straightforward education about ConocoPhillips’ responsible development of natural gas and oil. The website enables users to easily contact their legislators and weigh in on America’s energy policy. Calls to action via this site were crucial in the repeal of the crude exports ban and in response to proposed regulations across the Lower 48 and in Alaska.