Stefan Padfield: Does the SEC Believe ‘Transing’ Kids Is Normal Business for CVS

Free Enterprise Project Commentaries

Posted at 20:53hin CVS, Featured, Free Enterprise Project, Published Commentaries by Stefan Padfield

The SEC Staff recently issued a "no-action" letter that can be read as concluding that CVS's ordinary business includes "transing" kids. How can I say that? Allow me to provide some background first. (Note that I will highlight the controversial nature of certain terms and phrases herein by placing them in quotes and linking to sources supporting my characterization at least the first time I use them.)

I am the Executive Director of the Free Enterprise Project, which is part of the National Center for Public Policy Research (NCPPR). NCPPR is a shareholder of CVS, and I recently submitted a shareholder proposal to CVS asking CVS to reconsider its participation in the Human Rights Campaign's Corporate Equality Index (HRC's CEI). The proposal argues that CVS's participation in the CEI exposes the company's bottom line to unjustifiable risks given the radical transgenderism promoted by HRC.

CVS claimed the proposal could be excluded from CVS's proxy statement because it impermissibly sought to interfere with the company's ordinary business. As is standard in such cases, CVS requested a letter from the SEC Staff confirming the Staff would recommend no action be taken against CVS if it excluded the proposal. The SEC Staff complied.

But here's the problem (or at least one of the problems): Companies may not exclude proposals even when they otherwise impermissibly interfere with ordinary business if the proposal raises sufficiently significant social policy issues that transcend day-to-day business matters. So, let's get into the social policy issues raised by CVS's participation in HRC's CEI.

Here's the core proposition: It can reasonably be argued that HRC pushes gender dysphoria and transgenderism on children, including "chemical castration" and "experimental sex change surgeries" for minors (sometimes behind the backs of their parents), and that CVS's support of that agenda creates unnecessary risks to its bottom line. (Obviously, all these concerns can be, and routinely are, framed positively. But it is precisely the hotly contested nature of these issues that makes them significant and risky.)

Does HRC push gender dysphoria and transgenderism on children? Well, one of its initiatives is a "Welcoming Schools" program that expressly targets "Pre K - 12 educators and youth-serving professionals" with materials like a film wherein "6 to 12-Year-Olds Talk About LGBTQ+ Topics."

Does HRC push chemical castration and experimental sex change surgeries on minors? Well, HRC supports the World Professional Association for Transgender Health (WPATH), which in its most recent guidelines, according to one source, has "removed any minimum age limit for a child to be given puberty blockers, cross-sex hormones or sex-reassignment surgery (so long as that child has reached 'Tanner Stage 2' of puberty, which can be as young as nine years old)."

Does HRC support this ideologically-driven medical experimentation on children behind the backs of parents? Well, the same source quoted above also notes that WPATH advises healthcare professionals "to prescribe hormone treatment for children without parental involvement, if such [parental] involvement would be 'harmful or unnecessary.'"

Is it fair to say CVS supports HRC's agenda? Well, in addition to participating in the CEI, by which - according to some - "the Human Rights Campaign acts as a kind of LGBTQ mafia, forcing companies to embrace gender ideology in exchange for a high rating in the Corporate Equality Index," CVS is also a Platinum Corporate Partner of HRC, which is described by HRC as a network of "companies that support the work of HRC."

So, one defensible conclusion after all the foregoing is that when the SEC Staff concludes that aligning with HRC is part of CVS's ordinary business *and* does not raise any transcending significant social policy issues - the SEC Staff has concluded that transing kids is part of CVS's ordinary business. But wait, there's more.

CVS is a health care company, which raises the very disturbing specter that part of the reason it is supportive of transing kids (assuming you agree with that characterization) is so that it can benefit financially by, for example, providing the drugs associated with transitioning (i.e., CVS is part of the transgender industrial complex; see, e.g., here and here). And while one might argue that's actually in favor of concluding all this is simply ordinary business, the problem is you are unlikely to find any disclosure from CVS along the lines of: "We support transing children because it's profitable for us." The absence of any such disclosure brings us right back to all the foregoing raising a serious social policy issue that shareholders should be allowed to vote on.

Stefan Padfield is Director of the Free Enterprise Project at the National Center for Public Policy Research. This was originally published at RealClearMarkets.