Investors are pushing back against corporate political spending
Shareholders at seven different companies have filed resolutions asking those companies to refrain from spending from their general treasuries to influence elections.
The resolutions, where were filed with 3M, EQT, Exxon Mobil, Chevron, Bank of America, Target and Starbucks, are in response to the unprecedented level of undisclosed outside spending in recent elections. According to a report by U.S. PIRG and DEMOS, outside spending in the 2012 election cleared the $1 billion mark, and as much as 58 percent of the funds came from groups able to take unlimited contributions from corporations and individuals without disclosing their donors.
Corporations accounted for roughly 12 percent of all disclosed donations to super PACs during the 2012 elections. But while super PACs are required to disclose the sources of their funding, corporations have several avenues to spend in secret. They can donate to 501c groups, and trade associations like the U.S. Chamber of Commerce, a political spending juggernaut. The U.S. Chamber spent more than $36 million in 2012 to influence the outcome of 37 Congressional races and the Presidential race.
With so many ways for corporate executives to funnel funds into elections, it’s no wonder that last year a record-breaking 126 political spending resolutions were filed. “The value of corporate political spending to shareholders is highly questionable, even as the risk it poses to our democracy is self-evident,” said Shelley Alpern, director of social research and advocacy at Clean Yield Asset Management. “It’s time for companies to reverse course and simply exit this activity.”
Clean Yield Asset Management filed the resolutions at 3M and EQT, both companies with record of using their corporate funds to try to sway elections. 3M came under fire in 2010 for third-party donations to a candidate so controversial he inspired boycotts. EQT has in recent years poured more than $172,000 toward electing Pennsylvania’s governor and state legislature, which has been infamously lax in regulating fossil fuel companies (like EQT) engaging in natural gas fracking. Chevron, where Green Century Capitol Management has filed a resolution, in 2012 made a $2.5 million dollar contribution to the Congressional Leadership Fund, a super PAC that supports House Republicans.
“Regardless of how much is being contributed, companies simply should not be able to take investors’ dollars and use them to sway political campaigns,” Dale Wannen, of Harrington Investments, said. “The mere fact that this is allowed is atrocious.” Harrington Investments is pushing a resolution at Starbucks that asks that the company refrain from political spending from its treasury and agree not to establish a PAC.
Corporate spending in politics has drawn much criticism from shareholders since the disastrous Citizen’s United decision, but with each year more and more have pushed back by supporting resolutions like these. With investors moving forward with these hard-hitting resolutions, 2013 looks to be a promising year for corporate accountability advocates.
Kelly Ngo is the legislative assistant for Public Citizen’s Congress Watch. For more about the Corporate Reform Coalition, follow @CorporateReform on Twitter.