Effort to push back on woke companies starts with Bank of America

Charlotte, N.C. skyline and Bank of America headquarters building. Source: WikiCommons.

Listen to this story (7 minutes)

  • Bank of America's annual meeting will be held on Tuesday, April 26.
  • The chairman of the initiative is the former CEO of McDonald’s USA.

Conservatives are in a fighting mood nationally when it comes to corporations meddling in politics, as can be seen with Florida taking away Disney’s special government district and in Monday’s news that billionaire Elon Musk is buying Twitter to add more balance and free speech.

Building on that momentum is an organized effort to eject woke doctrine from corporate boardrooms through something called The Boardroom Initiative — and their first target is North Carolina’s largest corporation, Bank of America. 

The Boardroom Initiative is a collaboration among three groups, the Legal Action Fund, which is a project of the Job Creators Network Foundation; 2nd Vote; and the Free Enterprise Project. The executive chairman of the initiative is Edward H. Rensi, former president and CEO of McDonald’s USA.

Scott Shepard, another of the board members of the project, spoke to CJ about the Boardroom Initiative and his shareholder proposal to Bank of America, which is being voted on by shareholders at their annual meeting on Tuesday, April 26.

Shepard said he had been a law professor for about a decade before his current vocation, but he said “woke” came to the campuses and to law way before it arrived in the boardrooms so it “became too hostile to stay with.” Now he is director of the Free Enterprise Project, which is part of the National Center for Public Policy Research and one of the three coalition members of the Boardroom Initiative. On their website, they describe the FEP as “the conservative movement’s only full-service shareholder activism and education program.”

Or as Shepard puts it: “What we’re trying to do is keep corporations neutral, keep them doing business and staying out of politics, and using this, we hope — this sounds a little grandiose — as the beginning to a long countermarch through the institutions.”

Shepard continues his work in conservative shareholder activism, now with the Boardroom Initiative, and has now filed a shareholder proposal with Bank of America calling for a civil rights audit of the corporation.

“We’ve gotten so far into woke, so far into equity, and so far into critical theory that really the first step is the Civil Rights Act,” Shepard said. “[The Civil Rights Act of 1964] establishes the same civil rights for everyone. You can’t discriminate against anybody on the basis of race, sex, now sexual orientation, ethnicity, religion.”

Shepard said that corporations across the country are ignoring this basic reality of law and are instead pushing forward with equity policies that actively consider race and other protected classes when making decisions on hiring and on doing business. 

“Programs like Bank of America has that are explicit in their discrimination… none of us can understand how they don’t obviously violate the whole codex of civil rights statutes since 1964,” Shepard said. 

He said because of the widespread nature of equity as applied by major institutions, they are “wildly overconfident” on the legality of such practices, adding, “All of this just strikes me as insanely unconstitutional.” 

With this in mind, the shareholder proposal Shepard presented at the shareholders’ meeting recommended a full civil rights audit to see to what degree Bank of America has been violating laws preventing discrimination by race and other protected classes, even if it is discrimination ostensibly being done for enlightened, progressive reasons, like diversity, equity and inclusion (DEI). 

Shepard’s proposal asked for a report, either commissioned by the company or by a third-party independent auditor, that will look at those programs and determine if they violate or are in compliance with civil rights law. 

“Interestingly, Bank of America I think chose to misunderstand our proposal,” Shepard said. “We’re asking for this report that says, in pursuing diversity and in pursuing inclusion, let’s do a study to make sure we’re not violating anybody’s civil rights. And in response, they understood it to mean asking for a pro-equity audit — and equity means discriminating now to make up for discrimination in the past.”

So, Bank of America instead of taking a critical eye to how their equity work might be violating civil rights law, created a report showing all the ways they were pursuing exactly the kinds of potentially illegal programs Shepard was trying to find. 

“It listed in its own proxy report all sorts of programs — lending programs, internship programs, community programs, hiring programs — that are all explicitly discriminatory on the basis of race, sex and other basis.”

Shepard said that because the proposal was so clear in being critical of equity that “it had to be purposeful misinterpretation.” But on the other hand, even if they misunderstood on purpose, he said “showing how bad the problem is” might not have been a good strategy. 

Brian Moynihan, the Bank of America CEO, has aggressively pursued “stakeholder capitalism,” according to Shepard. This is a modern trend in corporate governance where the board declares that they are not just making decisions for the company based on the interest of the shareholders of the company, but on the interest of all stakeholders. The whole community they operate in, or sometimes specific minority groups within it, are declared “stakeholders,” and the board pursues left-wing political action — like green projects or equity work — allegedly in the name of those stakeholders. 

Shepard believes they are actually using shareholder resources in pursuit of their own personal policy preferences, which “sure looks like self dealing,” an illegal use of company resources for personal gain. Self-dealing is also something the CEOs are personally responsible for, since they can’t pay shareholders back with shareholders’ own money. 

“One or two jury verdicts that took big money out of a couple CEO’s pockets and all of this would wilt like a good analogy about wilting,” Shepard said.

On the proposal’s timeline, Shepard said they submitted it to the board in November, then Bank of America agreed not to challenge the proposal with the SEC as long as Shepard “agreed to a couple language tweeks.” He said they agreed to those tweeks as long as they could have it voted on at the annual shareholder meeting, on April 26.