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Political donations
HSBC has a long-standing policy of not making political donations. As a precautionary measure and in light of the wide definitions of political donations or expenditure in the UK Companies Act 1985, we obtained shareholder approval in 2003 for political donations or expenditure up to a maximum aggregate sum of £250,000 for HSBC Holdings plc and £50,000 for HSBC Bank plc over a four-year period. These authorities have not been used. Shareholder approval for renewal of these authorities was sought at the 2007 Annual General Meeting (AGM). The UK Companies Act 2006 enables the Directors to seek relief from liability and ratification by shareholders for any inadvertent unauthorised political donation or expenditure. On that basis, the proposed authorities would expire on the earlier of the date on which the last of the sections of the UK Companies Act 2006 relating to ratification by shareholders and political donations and expenditure come into force - expected in October 2007 - and the conclusion of the AGM in 2008.
The US Federal Election Campaign Act of 1971 permits corporations, unions and trade associations to establish political action committees for the purpose of collecting voluntary contributions from employees- as distinct from the company itself - for federal or state political candidates and organisations. The HSBC Political Action Committee operates separately from the company, is governed by by-laws and all activities are reported to state and federal election communities. HSBC-North America itself makes no political donations.
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