The notion of mandatory political spending disclosure remains hugely controversial. Further to our report in May 3rd's Society Alert, as was the case last year (see Sec. 707) and prior, the omnibus spending bill signed by President Trump on May 5th to fund the Federal government for the rest of the 2017 fiscal year (until September 30th) prohibits the SEC from using funds to finalize, issue, or implement any political contributions disclosure rule (Sec. 635). While popular with Republicans and corporates, who overwhelmingly prefer the current voluntary disclosure scheme (at best), concerns that newly-appointed Republican SEC Chair Jay Clayton won't support mandatory disclosure reportedly triggered a "nay" vote by Sen. Robert Menendez (D-NJ) on Clayton's confirmation last week (which we reported on here). According to the recently-released 2016 Board Practices Report, a collaborative board practices benchmarking effort between the Society and Deloitte LLP's Center for Board Effectiveness, almost half (46%) of respondents' boards/board committees oversee their corporate political contributions/expenditures, and 32% overall don't even make political contributions/expenditures. However, oversight varies significantly by company size - with 71% of large-caps reporting board or committee oversight, compared to 31% of mid-caps and just 5% of small-caps.
This describes the level of political contributions/expenditures oversight by respondents' boards or board committees:
- 54% review the company's political contributions/expenditures
- 53% review the company's policy on contributions/expenditures
- 51% provide general oversight
- 37% review the company's payments to trade associations
In addition, just over 30% of companies disclose membership in trade associations that make political contributions/expenditures to some degree, and nearly 30% publicly disclose their political contributions/expenditures on lobbying.
See also this article from The Hill, and numerous additional resources on our Political Contributions & Disclosure topical page.
The iconic Society/Deloitte Board Practices Report - which presents findings from a survey distributed to the Society's public company members in late 2016 - covers trends in over 15 areas of board practices and hot topics including cyber risk, shareholder activism, and board diversity.