PayPal loses SEC challenge, must allow shareholders to consider viewpoint diversity proposal
Payment processor sought to avoid shareholder transparency on politicized actions, called upon to participate in ADF Viewpoint Diversity Score Business Index
WASHINGTON – The U.S. Securities and Exchange Commission has ruled against PayPal’s attempt to exclude a shareholder resolution on viewpoint diversity from its ballot for its annual shareholder meeting.
“Major corporations like PayPal shouldn’t be hiding from their shareholders, and the SEC’s decision is a much-needed step toward transparency,” said Alliance Defending Freedom Senior Counsel and Senior Vice President for Corporate Engagement Jeremy Tedesco. “PayPal needs to rebuild trust with its shareholders and clients, but that can’t happen unless it answers basic questions about treating everyone equally regardless of their political or religious views. PayPal needs to address its recent track record of threatening the fundamental freedoms of its customers and implement the best practices identified by the Viewpoint Diversity Score Business Index, the first comprehensive benchmark measuring corporate respect for free speech and religious freedom.”
PayPal raised significant concerns last year when it announced that it was changing its terms of service to block donations to individuals and organizations promoting disfavored speech, even going so far as to specify that $2,500 could be withdrawn from offending accounts for each violation of the policy. Even after significant public backlash, PayPal customers are still under threat of receiving a fine for engaging in whatever PayPal deems as “the promotion of hate…or other forms of intolerance that is discriminatory….”
In November of last year, PayPal was featured prominently in the “Statement on Debanking and Free Speech,” signed by a group of nearly 60 financial professionals. PayPal scored just 7% overall in the 2022 Business Index, making it the lowest-rated financial services corporation when measured for respect for free speech and religious freedom of customers, employees, and other stakeholders.
The SEC’s denial of PayPal’s request comes just days after its parallel ruling on a JPMorgan Chase request, which ADF attorneys and attorney Jonathan Berry of Boyden Gray & Associates successfully petitioned the SEC to oppose.
Learn more about Viewpoint Diversity Score and the Business Index at www.ViewpointDiversityScore.org.
Alliance Defending Freedom is an alliance-building, non-profit legal organization committed to protecting religious freedom, free speech, parental rights, and the sanctity of life.
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