Among the key takeaways from The Conference Board's January 25 - February 2 survey of representatives of 84 public (69%), private (24%) and non-profit (75) organizations (95% with annual revenues >$1 billion) about how their corporate PACs responded to the January 6 riot at the Capitol in Washington D.C.:
Contributions Paused - Approximately 27% suspended contributions to those who voted against certification of the presidential election, either temporarily (12%), permanently (3%), or for an undecided period (11%), and another nearly 28% suspended PAC contributions to all members of Congress. The balance did not take any action for one reason or another including they don't have a PAC, they are still considering what to do, or they have affirmatively decided not to respond (about 19%).
Decision-making Factors - The most common response drivers were senior management's views, belief that a stable democracy is necessary for a stable business environment, and concerns about company reputation, as shown here:
Disclosure - A plurality of organizations (46%) did not announce the steps they were or are taking with respect to PAC contributions; however, nearly 28% announced their actions internally and externally, and another 24% announced their actions internally.
Board involvement - Boards were not commonly involved in the decision-making, with just 4% indicating that their boards made the decision. Nearly 27% of organizations informed their board of directors about their response at the time of the decision; 11% consulted with their board; and 7% informed their board before they made a decision. As previously reported, according to the Center for Political Accountability-Zicklin "2020 Index of Corporate Political Disclosure and Accountability," which benchmarks S&P 500 corporate political spending practices and disclosure, the majority of companies have some level of board political spending oversight; however, the oversight structure and scope vary among companies, as shown here:
See this Cooley post; our recent reports: "Investors Target CEOs on Corporate Political Spending," "On the Agenda: Corporate Political Spending/Lobbying," "PAC Review Action Items," and "Annual Meeting/Proxy Prep: Political Contributions & Disclosure"; Proxy Insight's "Reaching a Boiling Point" (page 3); and additional resources on our Political Contributions & Disclosure topical page.
This post first appeared in the weekly Society Alert!