by Cydney Posner
The WSJ is reporting that the provision prohibiting the SEC from adopting requirements for political spending disclosure has survived as part of the omnibus spending bill (12/15 text ). (See this PubCo post.) Not that the SEC was addressing the issue anyway. More specifically, Section 707 of the bill provides that “[n]one of the funds made available by any division of this Act shall be used by the Securities and Exchange Commission to finalize, issue, or implement any rule, regulation, or order regarding the disclosure of political contributions, contributions to tax exempt organizations, or dues paid to trade associations.” The article reminds us that the SEC received over a million comment letters on a 2011 rule-making petition submitted by a group of academics requesting that the SEC propose rules requiring political spending disclosure. But as discussed in this PubCo post, SEC Chair Mary Jo White has been firmly against any such undertaking, contending that the SEC should not get involved in politics.
Assuming the bill is signed into law, it will then be entirely up to companies to disclose their political spending on a more or less voluntary basis. And, incrementally, corporations seem to be moving in that direction on their own. According to the Center for Political Accountability at the Wharton School, the 2015 CPA-Zicklin Index of Corporate Political Disclosure and Accountability (which is produced by the CPA), more than half of the companies in the S&P 500 – 54%, or 270 companies –had a dedicated webpage or similar space on their websites to address political spending and disclosure. (Some disclosure examples can be found in the report.) In addition, CPA reports that 145 U.S. companies, including 126 in the S&P 500, have adopted the political disclosure and accountability model proposed by CPA.
More specifically, according to the CPA,
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“State Candidates, Parties & Committees: In 2015, half of the 497 companies included in the Index either disclosed some level of information about their contributions to candidates, parties and committees or had policies prohibiting these contributions.
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National 527 groups: Almost half (46 percent) of companies either disclosed some level of information about contributions to entities organized as 527 groups under the Internal Revenue Service codes, including national governors associations and super PACS, or had policies not to give to such organizations.
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Ballot measures: In 2015, 205 companies (41 percent) disclosed some information about their payments to intervene in ballot measures, or said their policy was not to engage in such activities.
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Trade Associations: 204 companies (41 percent) disclosed some level of payments to trade associations in 2015, or said they instructed trade associations not to use these payments on election-related activities.”
