It threatened to be an embarrassing affair. How could French companies justify spending 728,000 dollars in direct financing of candidates in the state and local elections that coincided with the presidential contest last week? Confronted with the revelations – made on the environmental and social affairs website Basta! – all the business groups concerned gave the same response and pleaded their innocence. This was that it was not the companies themselves but their employees working in the firms' American subsidiaries who had voluntarily decided to make a personal contribution to the financing of the campaigns.
“The system is totally different from European practice,” they all insist. And that it is all down to the United States law on political funding. This skilfully-drafted text permits all forms of financial contortions while at the same time allowing donors to display their virtue, thus avoiding all legal question marks, for example on the misuse of company assets. “American law forbids all direct political funding by companies,” explains Guy Hicks, vice-president in charge of government relations for defence and aerospace firm EADS North America.
“But it is possible to create political action committees (PACs) which allow the collection of donations in companies to fund campaigns directly,” he says. “Only employees of American nationality have the right to contribute to them, and on a voluntary basis. The money collected is allocated by a completely independent committee of employees. The companies' managements have absolutely no right of inspection over the candidates chosen. They simply provide administrative help in the collection process,” concludes Hicks. At energy group GDF Suez a spokesman insists: “We are not in any way responsible. It is the employees who organise it.” And they do so generously, too. For if one adds donations to parties and organisations to those given directly to candidates, the total given by employees of French subsidiaries in the United States reaches nearly two million dollars.
However, if one looks more closely at the list of donors to American elections established by the site OpenSecrets.org - assuming it is exhaustive – it appears that the American employees of certain French groups were more closely involved in the Congressional campaigns than others. For while nearly all large French groups have a presence in the United States, only 20 of them have PACs, including EADS and the energy and commodities group Louis Dreyfus who are based in Holland. This does not mean that the others decline to take part in the funding of American politics. But they doubtless prefer to use the more discreet channels of professional bodies or lobbyists.
The groups where PACs committees do exist include nuclear energy firm Areva, building materials firm Lafarge, healthcare firm Sanofi, GDF-Suez, insurance group Axa and telecommunications and media firm Vivendi. Perhaps it is no accident that all these groups operate in areas that are very sensitive to changes in regulations and legislation. The same goes for German firms. Here, too, it is the American employees of companies such as BASF, Siemens, Bayer, Deutsche Bank and cement giant Heidelberg who are the most aware of what is at stake electorally.
A passion for politics
The financial commitment of employees involved in PACs also varies greatly from company to company. The American staff of the aerospace, defence and security firm Safran raised just 1,000 dollars to support a Republican senator who is very influential in defence issues. As for employees at drinks firm Pernod Ricard they raised 2,000 dollars for two Republican candidates in Florida where the subsidiary is based. Meanwhile the political action committee at industrial gas group Air Liquide - present in the US since 1920 – collected 8,000 dollars split between six candidates (four democrats and two republicans).
However, staff at other groups seem to be gripped by a greater passion for politics. At the American subsidiaries of the nuclear firm Areva no fewer than 88,000 dollars were raised for candidates to the House of Representatives and the Senate, to which can be added contributions to parties and support organizations. This brings the figure to 140,000 dollars in total. The amount is not disputed by the group here in France.
Such political generosity seems to have been part of staff culture at the group for several years, if the revelations on the OpenSecrets.org site are to be believed. In the same way the American employees of EADS and AXA also appear to be closely involved in political life. They gave 315,977 dollars and 190,000 dollars respectively to parties and candidates at the last elections.
But the prize for political commitment undoubtedly goes to staff at the Sanofi healthcare group. They have set up two PACs, one for Sanofi and one for its sister company and vaccine specialists Sanofi Pasteur. Together they gave 425,140 dollars to parties and candidates at the recent elections. Indeed, staff at the firms went further and wanted to add their own personal contributions, which raised more than 250,000 dollars. The overall contribution made by staff at Sanofi and Sanofi Pasteur thus totalled more than 676,000 dollars. Of course there is no suggestion that this level of support had anything to do with past and future discussions on policies relating to healthcare and medicines in the United States, or even intellectual property and patents...
As the communications departments of the French groups keep insisting, the employee committees are left totally free in their choice of who gets the donations. These committees have clearly changed their views considerably over several years. While collectively they gave more than 60% of the sums raised at the last elections in 2010 to Democrat candidates, this time they chose to give more to the Republican Party and its candidates, who received more than 65% of the funds collected. Of course these choices are simply an illustration of how opinions can shift, and there is no suggestion that they took into account the preferences of the world of business, which at the last American elections openly adopted a stance in favour of the Republicans...
An alignment of interests
In the same way it is, of course, pure chance that the choice of which candidates to back made by the various political action committees often produce the same names. Thus the PACs at Axa, Vivendi and Sanofi, whose managements are very close in France even though the groups are involved in very different activities, found themselves supporting the same ten or so candidates, many of them close to the grassroots Tea Party movement. As for staff at EADS, they preferred to back candidates heavily involved in defence and aeronautical matters. “It's obvious that the employees often have the same views and the same interests as us,” says Guy Hicks from EADS.
In its investigation Basta! magazine highlighted the curious tendency for the committees at Lafarge, Areva and GDF Suez all to gravitate towards candidates who deny that climate change is a problem or who are opposed to all strengthening of environmental regulations or of the US Environmental Protection Agency. “Of the 33 candidates that GDF-Suez supported, the French group gave thousands of dollars to sixteen Republicans who are clearly climate sceptics, as well as six others opposed to all form of regulation of greenhouse gases,” says the magazine.
“Almost three-quarters of the direct contributions from the company – around 40,000 dollars – went to them. For its part the building firm Lafarge financed twelve climate sceptic candidates and five opposed to all regulation regarding the climate. That means 17 candidates out of 23, to whom the company distributed 48,500 dollars in contributions,” the magazine notes.
This might seem strange for groups that never stop highlighting their environmental commitment and their determination to fight against climate change and greenhouse gases. Does it not bother these companies that their American employees support candidates who have adopted positions radically opposed to those that they officially defend? “We are in no way associated with the choices of the employees,” insists a spokesman at GDF-Suez.
But is it not at least a setback for the group that it has not been able to persuade its staff to share the company's values? “We respect the freedom of opinion of each person,” responds the spokesman. The question produces the same embarrassment and silence at Lafarge and Areva. In spite of all the legal artifices, the fiction surrounding the funding of US elections eventually starts to unravel.