-By Paul Blumenthal
July 13, 2011- Congressional Democrats are stepping up support for transparency in corporate political spending ahead of the 2012 elections.
On Wednesday Rep. Michael Capuano (D-Mass.), Sen. Robert Menendez (D-N.J.) and Sen. Richard Blumenthal (D-Conn.) held a press conference to introduce a bill that would put more power in shareholder hands in decisions over corporate political spending, as well as require public disclosure of those spending decisions.
The bill, known as the Shareholder Protection Act, would allow shareholders of public companies to vote on political spending on an annual basis. It would also require quarterly disclosure reports to be filed with the Securities and Exchange Commission (SEC) revealing any contributions by a company to a group spending on elections, either by way of independent expenditures or electioneering communications.
The lawmakers made clear that the money spent from the treasuries of publicly traded companies is shareholder money, not just management's money.
"Would anybody here object if I reached into your wallet and contributed to my favorite candidate?" Capuano asked at the press conference. "It's about whose money is it. … Let the people who own that money decide."
The effort comes a year and a half after the Supreme Court ruled in the case Citizens United vs. Federal Election Commission that corporations could spend money on independent expenditures to support or oppose candidates for election. This ruling opened the door to a host of new campaign spending vehicles, including non-profit groups that do not have to disclose their donors — an effective disclosure loophole.
In June, a coalition of more than seventy reform groups urged support for the bill in a letter to Congress. The coalition letter stated:
Responsible corporate governance requires the involvement of informed shareholders and is not a partisan issue. We believe that holding management accountable and ensuring that political spending decisions are made transparently and in pursuit of sound business is important for both the market and for democracy.
Ciara Torres-Spelliscy, an incoming assistant professor at Stetson University College of Law who has written extensively on the issue, told HuffPost, "When you're talking about a publicly traded corporation … which have millions and millions of shareholders, the idea that a single corporate manager could know how to represent [all of the shareholders] is ridiculous."