Wal-Mart Stores said it will start disclosing directly to investors what it spends on lobbying on a state-by-state basis, responding to shareholder pressure to improve transparency on how the retailing giant seeks to influence public policy.

The previously unreported move would make Wal-Mart the first constituent of the Dow Jones Industrial Average to break out state expenditures at that level of detail, drawing attention to spending that in some states reaches hundreds of thousands of dollars. Wal-Mart's move could chart a course for others, just as rival retailers followed suit when it raised worker pay earlier this year.

While federal guidelines are uniform and fairly detailed, disclosure at the state level varies widely and information can be difficult to find, undermining attempts at oversight by outside groups. At the same time, gridlock in Congress has shifted the focus of some corporate lobbying to the states, raising the importance of transparency, disclosure advocates said.

Wal-Mart's decision to make state lobbying information more accessible is "exceedingly important" because spending at the state level can rival or exceed federal lobbying expenditures and also because of the company's size and influence across the corporate sector, said Timothy Smith, director of socially responsible investing at Walden Asset Management, which has backed several shareholder proposals seeking improved disclosure.

Since the first shareholder proposals targeting lobbying first appeared in 2011, there have been 143 resolutions on the ballots at 80 companies, and support has risen to an average of 29.2 percent of votes this year, according to proxy adviser Institutional Shareholder Services.

Wal-Mart's move falls short of what Zevin Asset Management sought when it submitted a shareholder resolution for wider disclosure at Wal-Mart, including any "indirect lobbying" through organizations like the U.S. Chamber of Commerce. Wal-Mart will not change its disclosure policies on trade associations, spokesman Randy Hargrove said.

Zevin Director Sonia Kowal said she withdrew the proposal as a sign of "good faith" after Wal-Mart agreed to aggregate state disclosures. She said she would resubmit the proposal next year.

Kowal said she has found Wal-Mart to be responsive to shareholder engagement "perhaps because they see disclosure of corporate involvement in politics as being increasingly important to investors and that interest is not likely to diminish."

Wal-Mart will not report any information not already available in state disclosures. But within a few months it plans to start providing a tally for spending in each state with a link to the relevant filing, aiming to make it easier for investors to find the information, Hargrove said.

"We take our commitment to provide additional transparency into our political engagement seriously," Hargrove said, noting that Wal-Mart already provides links to quarterly federal lobbying reports on its website, among other steps.

BYZANTINE DISCLOSURE

The act of aggregating state data into a readable format is a significant step because the "Byzantine" manner in which the data is captured and made available online effectively buries information at many states, said Denise Roth Barber, managing director at the National Institute on Money in State Politics, which itself has struggled to build a comprehensive database of state spending.

"Given the wide disparity of disclosure laws and how that information is provided to the public it is nearly impossible to find this information out on your own," she said, adding the move by Wal-Mart could prod others to disclose more. "It would be impressive for Wal-Mart to provide that information in one place."

In 2014 Wal-Mart spent $7 million on lobbying at the federal level, making it one of the largest corporate spenders. It was active in targeting issues like labor, tax and trade, including the Trans-Pacific Partnership trade pact being pushed by President Barack Obama, public filings show.

The biggest corporate spenders include Comcast and Google at about $17 billion each, according to the Center for Responsive Politics.

States such as California and Wisconsin require relatively detailed disclosure including payments to lobbyists and what bills were lobbied on. In several states like Georgia the reporting of lobbyist compensation is not mandatory, meaning only typically smaller outlays, such as dinners with legislators, are available. In some cases figuring out what was spent can prove tricky, requiring digging into reports from multiple lobbyists in formats decipherable only to the trained eye.  

Filings from California show Wal-Mart paid lobbyists $319,000 last year to advocate on its behalf on various laws, including some tied to wages and other labor issues. Spending in Texas, which only requires the disclosure of a range, may have been as high as $315,000, filings show.

While pleased with the move on state disclosure, Zevin's Kowal said shareholders want greater transparency on all spending, including trade associations and tax-exempt organizations writing model legislation.     

When Zevin submitted its proposal last year, it cited concerns over Wal-Mart's involvement with the Chamber of Commerce in part because the association had reportedly lobbied against the Foreign Corrupt Practices Act.

Bruce Freed, president of the Center for Political Accountability, believes that in general corporate disclosure on political spending and lobbying has been improving. But he says the picture will remain incomplete until contributions to organizations like the Chamber of Commerce and social welfare groups exempt from reporting donors are disclosed.

"In the end what you really are looking for are the spending figures that are not disclosed, and that includes the major trade associations," Freed said.