U.S. Sen. Bob Menendez today joined 13 fellow senators in calling on the Securities and Exchange Commission to mandate corporate disclosure of campaign contributions.
The letter from the senators comes as the two-year anniversary of the momentous Citizens United Supreme Court decision approaches. That decision allowed companies to spend money in direct support of a candidate for office as well as in donations to the so-called “Super Pacs.”
The decision has been attacked by Democrats for the past two years as one that alters the political landscape and gives corporations undue influence in the election process. The letter from the senators does not seek to have the SEC restrict the donations, but instead force companies to disclose their spending as part of their financial reporting requirements.
“We urge the SEC to consider using its rulemaking authority to issue rules that would require corporations to disclose their political spending to shareholders,” the letter states. “The disclosures should include spending on independent expenditures, electioneering communications and donations to outside groups for political purposes, i.e., Super PACs. Such disclosures can be online in an easily searchable format and can also use existing communication lines between corporations and shareholders, such as proxy statements, quarterly and annual reports, and registration statements.”
The senators go on to say that the information should be available to shareholders and is something that shareholders, including large institutional investors and state treasurers, are asking for.
“While some companies, such as Microsoft, Wells Fargo, Merck and Aetna, have taken the steps to publicly disclose their political spending – illustrating not only the ease with which it can be accomplished but also the acceptance of this practice by many prominent and large corporations – many shareholders remain in the dark, unaware that their money could be funding political activities, or even political attack ads. The rights of shareholders must be protected and at present, we believe that they are being compromised,” the letter states.
The letter is signed by Menendez along with U.S. Sens. Tom Harkin, Mark Begich, Richard Blumenthal, Frank Lautenberg, Bernie Sanders, Al Franken, Jeanne Shaheen, Jeff Bingaman, Sherrod Brown, Tom Udall, Patrick Leahy and Sheldon Whitehouse.
Menendez outlined the letter on a conference call Wednesday held by a conglomeration of academics and financial professionals calling themselves the Corporate Reform Coalition that is also calling for the SEC to require disclosure.
Menendez also is a sponsor of the Shareholder Protection Act, which would require approval of corporate political spending by a majority of shareholders. The bill calls for an annual approval by shareholders of a political spending budget and for fiduciaries voting on behalf of shareholders to disclose their votes to those shareholders. The corporate board of directors would need to approve each expenditure over $50,000.