Nov. 18, 2015
CORPORATE REFORM COALITION
At Hearing, SEC Chair White Should Address the Need for the Corporate Political Spending Disclosure Rule
WASHINGTON, D.C. – For the sake of a functioning and accountable corporate democracy, U.S. Securities and Exchange Commission (SEC) Chair Mary Jo White should acknowledge the strong demand for a rule requiring disclosure of corporate political spending, the Corporate Reform Coalition said. Today, White is testifying before the U.S. House Financial Services Committee.
White should address the fact that to enact its mandate to protect investors, the SEC needs to require material disclosures of critical business information for investors, and react quickly to the changing practices and priorities of corporate entities, the Corporate Reform Coalition said. An obvious example of this need is the increased amount of spending in politics by corporate entities that has come in the wake of the U.S. Supreme Court’s 2010 Citizens United decision.
A petition to the SEC for rulemaking on disclosure of this spending has received more than 1.2 million supportive comments – a record for the agency and inclusive of a bipartisan group of former SEC chairs and commissioners, state treasurers, major pension funds and others.
Without adequate disclosure of corporate political spending, shareholders and investors have little means to hold corporate directors accountable and to safeguard their investments. Voluntary disclosure has led to a patchwork of information that makes it impossible for investors to manage, and potentially mitigate, the full range of risks presented by corporate political spending.
“Corporate political spending choices may diverge from a company’s stated values or policies and embroil the company in hot-button issues,” said Lisa Gilbert, director of Public Citizen’s Congress Watch division. “Investors have a right to know and understand if their invested money is going to support or oppose candidates or political issues.”
The Corporate Reform Coalition maintains that the SEC must protect investors and heed this request for action, and strongly encourages White to address the matter at the hearing and to move forward with the rule.