by Jeremy Leaming
Shareholders are ratcheting up pressure on corporate executives to reveal the extent of political expenditures, and, in at least one case, pushing back against over-the-top compensation packages for executives.
Reporting for The Washington Post, Tom Hamburger notes that the massive health insurance company WellPoint is facing an “an increasingly aggressive campaign to force disclosure of corporate political and lobbying expenditures, including payments to the U.S. Chamber of Commerce ….”
A coalition of institutional investors, Hamburger says, is calling for the resignation of board members for “allegedly failing to oversee ‘high risk political spending.’” In particular, the shareholder coalition is troubled by $86 million that a trade association, which WellPoint is a member, transferred to the U.S. Chamber of Commerce during its fight against the Obama administration’s health care reform work.
The Post says that the coalition’s “effort to hold specific board members responsible represents a new militancy in the fight to require companies to reveal their political activities,” which has grown out of the aftermath of the high court’s 2010 opinion in Citizens United v. FEC, granting corporations unfettered ability to spend on political campaigns.
Director of GMI Ratings Nell Minow told the newspaper that demanding action against specific shareholders “may be the only way you make any progress” on forcing corporate transparency of political spending.
As The Post notes, political spending by corporations can be a risky endeavor. As noted on this blog, several public interest groups have demanded that corporations cut their ties to the right-wing group, ALEC, which has lobbied states to enact so-called “Stand Your Ground” laws, and onerous measures that hamper voters. ColorOfChange and the Center for Media and Democracy have successfully encouraged about a dozen corporations, such as Blue Cross Blue Shield and Coca-Cola to stop sponsoring ALEC.
MarketWatch also reports that a growing number of shareholders are “agitating for corporations to disclose what they spend on political advocacy ….”