Microsoft president Brad Smith candidly confesses politics are pay-to-play in response to criticism over the company's donations to lawmakers who objected to US election results
- Microsoft president Brad Smith defended the company's political contributions, CNBC reported.
- Microsoft paused donations amid criticism of its gifts to GOP lawmakers who objected to election results.
- But Smith said donations are vital for getting invited to events so Microsoft can lobby lawmakers.
Microsoft president and chief legal officer Brad Smith offered his employees a candid take this week on why the company gives money to politicians, shedding light on the heated debate over how corporate America should respond to GOP-led efforts to overturn the results of the US presidential election.
"It plays an important role. Not because the checks are big, but because the way the political process works," Smith said, according to CNBC. "Politicians in the United States have events, they have weekend retreats, you have to write a check and then you're invited and participate."
Microsoft did not respond to a request for comment on this story.
After 147 Republican members of Congress challenged states' Electoral College votes earlier this month, on the same day protesters violently broke into the US Capitol in a deadly riot, America's biggest companies - and political spenders - faced criticism for their financial support of the lawmakers who had for months undermined confidence in the election.
One of those companies was Microsoft, which has given more than $178,000 to 61 those lawmakers through its political action committee, MSPAC, during the latest election cycles - the third-most among S&P 500 companies.
Microsoft temporarily paused all of its MSPAC contributions following pushback from employees. But as critics noted, the company hasn't specifically committed to stop funding the lawmakers who attempted to overturn the election results - despite Smith signing a letter denouncing those efforts - effectively penalizing lawmakers who upheld the principles espoused in the letter.
Smith argued to employees on Thursday that the contributions are still important because they get Microsoft's lobbyists access to politicians, which helps them build relationships so the lawmakers are more receptive when Microsoft wants to lobby them on an issue.
"If you work in the government affairs team in the United States, you spend your weekends going to these events; you spend your evenings going to these dinners, and the reason you go is because the PAC writes a check," Smith said, according to CNBC.
Smith added that the relationships built at these events make it more likely lawmakers will be receptive when he calls them to ask for their help on employees' immigration cases, as well as "issues around national security, or privacy, or procurement reform. Or the tax issues our finance team manages."
However, Smith didn't acknowledge contributions that companies give to candidates who are up for election and depend on those contributions to help them get - or stay - in power. In 2020 alone, Microsoft gave $88,000 to lawmakers up for election who eventually objected to Electoral College results.
Microsoft has come under fire from employees over its political support and government work before, and briefly paused its contributions in 2019 before quietly resuming them again just months later, according to Geekwire.
Smith's comments provided a more direct acknowledgment than most executives typically give about how American politics are often "pay-to-play" - particularly following the Supreme Court's 2010 decision in Citizens United that allowed companies to spend unlimited amounts of money to influence politics.
But they also came at a time when companies are facing unprecedented pressure from employees, customers, and shareholders, to rethink which candidates they support, who they do business with, and the positions they take on important national issues.