Menendez Leads Colleagues in Introducing Bill to Force Corporations to Disclose Political Spending to Influence Elections

Menendez Leads Colleagues in Introducing Bill to Force Corporations to Disclose Political Spending to Influence Elections

Shareholder Protection Act would require companies to seek authorization from a majority of shareholders before spending funds on political activities

 
WASHINGTON, D.C. – U.S. Senator Bob Menendez (D-N.J.) today led 16 of his colleagues in introducing the Shareholder Protection Act that would require public companies to gain approval from a majority of shareholders in order to spend funds on political activities. Since the Supreme Court’s ruling in 2010 that corporations should be treated as people, companies have been able to spend unlimited amounts of money to influence elections without disclosing that spending to shareholders.

“Dark money infesting our democracy has gone on long enough. For almost ten years, corporations and powerful special interests have been secretly spending huge sums of ‘other people’s money’ to influence our elections,” said Sen. Menendez.  “Shareholders – not corporate executives – should be making the call about whether or not they want their money spent on political campaigns. This bill would finally bring some transparency to corporate political spending and strengthen democratic values in our elections.”

“Ever since the disastrous Citizens United decision, corporations have used massive amounts of money to make powerful political statements and influence political campaigns – while using money from their shareholders to write the checks,” said Sen. Merkley. “Across America, millions of shareholders are kept in the dark about the political crusades their money is fighting, effectively stealing their voices just so that powerful and privileged company executives can amplify their personal political beliefs. It’s time for Congress to end this stolen speech and attack on our ‘We the People’ democracy by making sure companies’ owners have a say in the political battles being waged in their names.”

In Citizens United v. FEC, the Supreme Court ruled that corporations should be treated as people, which effectively allows corporations to spend an unlimited amount of money on campaign ads and various other political communications to influence elections and policy outcomes across the country. Since 2010, corporate executives have been able to treat money invested by shareholders as their personal political piggy banks

“Public Citizen has long supported the Shareholder Protection Act and applauds Senator Menendez and his Senate colleagues for holding corporate executives accountable for the money they spend in our politics and ensuring that shareholders- the true owners of corporations- have a say in that spending,” said Lisa Gilbert, Public Citizen's Vice President of Legislative Affairs. “On the heels of the historic For the People Act it’s clear that the American people demand and deserve accountability for corporate spending in our elections.”

Specifically, the Shareholder Protection Act would:

  • Require shareholders to authorize, on an annual basis, a political activities budget requested by a company. The budget must receive a majority of votes representing all outstanding shares. 

 

  • Require a company’s board of directors to vote to authorize each expenditure over $50,000 within the overall budget approved by shareholders.

 

  • Require public companies to disclose, to shareholders and the SEC, individual board member votes and the details of each such approved expenditure.

 

  • Require the Government Accountability Office (GAO) to periodically report to Congress on implementation and compliance.

 

The Shareholder Protection Act was included in the For the People Act, which was cosponsored by the entire Democratic Caucus.

The bill is cosponsored by Senators Jeff Merkley (D-Ore.), Cory Booker (D-N.J.), Jeanne Shaheen (D-N.H.), Mazie Hirono (D-Hawaii.), Richard Blumenthal (D-Conn.), Sheldon Whitehouse (D-R.I.), Chris Van Hollen (D-Md.), Kristin Gillibrand (D-N.Y.), Amy Klobuchar (D-Minn.), Elizabeth Warren (D-Mass.), Tom Udall (N.M.), Ben Cardin (D-Md.), Ed Markey (D-Mass.), Patrick Leahy (D-Vt.), Dick Durbin (D-Ill.) and Dianne Feinstein (D-Calif.).

A summary of the Shareholder Protection Act can be found here. The text of the bill can be downloaded here.

 

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