Shareholders Fighting for Transparency in Political Donations
This item by J.P. Green was originally published on May 25, 2012.
Yesterday I flagged an AlterNet post by Leo W. Gerard, international president of the United Steelworkers union about a coalition of shareholders, workers and public interest groups mobilizing to address outrageous executive pay, environmental and worker safety concerns. I expressed hope that this coalition would also address corporate contributions to political campaigns.
Having just read a New Republic article, "Reining In Corporate $$, The Back Door Approach," I can report that such stockholder's campaigns are already well underway. According to the author, Alec MacGillis, here quoting from a WaPo article by Tom Hamburger and Brady Dennis:
...Reformers have decided that their best hope for trying to rein in secret spending is to straight to corporations. As The Post reports: "One of the most polarizing fights over money in politics has been unfolding this spring at annual corporate meetings, where shareholders are mounting an intensifying effort to push companies to disclose the money they spend on lobbying and political campaigns. The transparency push, playing out at shareholders meetings from coast to coast this spring, has received cheers from campaign finance reformers and some corporate governance experts. It has drawn ridicule from critics such as the U.S. Chamber of Commerce, who see the effort as an attempt by liberal groups to squelch the voice of the business world....
...The Sustainable Investments Institute, a Washington nonprofit that tracks shareholder resolutions, found that 109 -- nearly a third of those up for votes at annual meetings in 2012 -- sought more disclosures about spending on politics and lobbying....To date, 101 major companies have agreed to disclosure and board oversight of some of their political spending, according to Bruce Freed, president of the Center for Political Accountability, which rates companies on the issue. Freed and others argue that disclosure can help executives and directors avoid reputational risk to their firms.
Naturally big business leaders and their journalistic apologists are in an uproar about the shareholder movements for disclosure of political donations, even though most of the resolutions have been defeated. But some companies, like Microsoft, are beginning to see the upside of transparency of their political donations.
As Dan Bross, Microsoft's senior director of corporate citizenship, puts it, "As a company, we believe in openness, transparency and accountability...We are doing what we believe is right."
As MacGillis notes, the shareholder movement does nothing to directly force more transparency among wealthy individuals or privately-held companies. However, he adds that "the momentum toward encouraging disclosure from corporations is as good as any place to start when the other avenues are blocked." It seems to me that, by setting a higher standard of accountability, the shareholder movement may yet have a positive effect on individuals and privately-held companies.
The shareholder campaigns should not be considered a substitute for legislation and litigation to compel transparency in political donations. But they can contribute to public awareness that transparency of corporate political donations is both desirable and possible.