In a recent paper, Delaware Supreme Court Chief Justice Leo E. Strine Jr. excoriates the Big 4 mutual fund families for voting against shareholder proposals seeking transparency for political contributions. His recommended action is radical. I offer a more moderate strategy. Continue Reading →
Tag Archives | Citizens United
2018 CPA-Zicklin Index shows gradual improvement. Public corporations embracing disclosure and accountability of their political spending hold fast despite countervailing pressures from Washington. Continue Reading →
The deceptive title of a recent op-ed in the Wall Street Journal would not keep politics out of the boardroom. Instead, the recommendations would deny shareholders the right to request boards disclose those politics, in addition to denying many other long-standing rights. Read the op-ed and weep that such trash gets published in the Journal.
This is my response to the 7/18/2018 op-ed “Keep Politics Out of the Boardroom” by Phil Gramm and Mike Solon. I waited before publishing this, in case WSJ chose to publish my rebuttal. They did not. Continue Reading →
Nell Minow is one of my heroes. Her 1991 book with Bob Monks, Power and Accountability: Restoring the Balances of Power Between Corporations and Society, helped me give a name and framework to what I thought was the world’s most important overlooked problem — corporate governance.
During the last 27 years, I have never met anyone else in the field of corporate governance as witty, insightful or quotable as Nell Minow. She demonstrates these qualities and more in a recent lecture delivered at Sarah Lawrence. Continue Reading →
Since 2003, the Center for Political Accountability (CPA) has spearheaded disclosure and accountability in corporate political spending. Corporations are the top political spenders at the state and local level. They are a dominant force in shaping public policy. Next proxy season, I will join the Center for Political Accountability in filing proposals on this important topic.
Center for Political Accountability: Citizens United
As I have reminded readers in previous posts, the US Supreme Court’s decision in Citizens United v. Federal Election Commission was based on a false premise. Justice Kennedy’s majority opinion justifies the decision by pointing to the Internet. Continue Reading →
Torres-Spelliscy’s Corporate Citizen? An Argument for the Separation of Corporation and State, analyzes the trail of legal cases that led to the 2010 Supreme Court decision in Citizens United, as corporations won rights originally reserved for citizens. Not only are they winning the rights of real persons, but they are avoiding the responsibilities of citizenship… like paying taxes.
Before reading the book, I vaguely knew one of the first key decisions stemmed from the Fourteenth Amendment to the U.S. Constitution, which says,
[n]o state shall… deprive any person of life, liberty or property without due process of law, not deny to any person… the equal protection of the laws.
I continue my review of The Handbook of Board Governance: A Comprehensive Guide for Public, Private, and Not-for-Profit Board Member. With the current post, I provide comments on Part 4 of the book, The Rise of Shareholder Accountability. As a shareholder advocate, this is my favorite part of The Handbook of Board Governance. See prior introductory comments and those on Part 1, Part 2 and Part 3. I suspect The Handbook of Board Governance will soon be the most popular collection of articles of current interest in the field of corporate governance.”
The Handbook of Board Governance: The Happy Myth, Sad Reality
Robert A.G. Monks warns, capitalism without owners will fail. The chapter is a condensed and updated version of Citizens DisUnited: Passive Investors, Drone CEOs, and the Corporate Capture of the American Dream, which I reviewed here. Continue Reading →
Let’s change Vanguard’s political disclosure vote. Our nation’s largest mutual fund voted against all resolutions submitted by shareholders asking for companies to disclose their political spending. Shouldn’t we have the right to know what candidates our investments are supporting?
Vanguard’s Political Disclosure Vote Needs Changed
Join more than 59,000 American’s who have already petitioned Vanguard to change their proxy voting behavior. Support shareholder resolutions that seek disclosure of political spending at companies where Vanguard owns a shares. If Vanguard votes with us, instead of against us, it won’t be long before other large funds like BlackRock start doing the same. Within a few years, we could actually begin to know what companies are funneling how much money to which candidates. Vanguard’s political disclosure vote can be changed – with your help. Sign the petition by U.S. PIRG to change Vanguard’s political disclosure vote. Continue Reading →
I think most Americans have a very limited attention span when it comes to investing, the SEC and especially corporate governance. When I came across SECDisclose.org earlier this week, I was delighted with a series of videos they have uploaded on dark money and with their byline: Because the S.E.C. shouldn’t stand for “S-E-C-RET.”
In a few paragraphs below lifted from SECDisclose and a press release from the Corporate Reform Coalition, I hope to perk your interest in this project so that you’ll share their links with your friends. I love their campaign. It is very creative. However, one thing the campaign fails to do, at least as far as I could tell in a quick look, is to call their viewers and readers to action. I’ve practically hounded my readers to death on this issue but will do so once again. Continue Reading →
Disclosure of corporate lobbying expenses remain top shareholder proposal topics for 2015, as more than 60 investors have filed proposals with more than 50 companies asking for reports that include federal and state lobbying payments, political contributions and/or payments to trade associations used for lobbying and payments to any tax-exempt organization that writes and endorses model legislation.
In 2014, resolutions relating to corporate political and lobbying expenses of a company were among the most common shareholder proposal put forth during the proxy season for the fourth consecutive year, and it is expected that these will be among the most popular shareholder proposal topics for 2015 proxy season. The bulk of political spending resolutions fall under two categories, either requesting disclosure of lobbying expenditures or seeking disclosure of political contributions. Continue Reading →
Five years ago today the US Supreme Court held that corporations could spend unlimited funds on election campaigns in their decision, Citizens United v. Federal Election Commission. Last night I joined about 100 people a local showing of Pay 2 Play: Democracy’s High Stakes. I highly recommend it. See the film with a group and leave plenty of time to talk what you can do to overturn the impact. The film suggests a number of reasonable solutions but as I have discussed before, the Court’s decision gave investors a special role.
Justice Kennedy’s majority opinion justifies the Supreme Court’s decision by pointing to the Internet. Continue Reading →
In the absence of mandatory disclosure, companies are increasingly, voluntarily adopting disclosure policies for their corporate political spending – largely in response to pressure from shareholders, investor advocates, the media, political groups and others. In this article, Chuck Nathan suggests that voluntary disclosure may or likely will become the norm – at least among larger companies – within the next few years. Given that potential, he provides some timely, seasoned advice – namely, that companies undertaking or considering such disclosure do so only in the context of a strategic communication plan that includes these critical elements: Continue Reading →
The Securities and Exchange Commission (SEC) announced that Brent J. Fields has been appointed as the agency’s Secretary, who is responsible for overseeing the administrative aspects of Commission meetings, rulemakings, and procedures. Let’s give Mr. Fields a warm welcome with a flood of e-mail supporting the petition to require companies to disclose political spending. Continue Reading →
H&R Block $HRB, which provides tax preparation and related services to the general public, is one of the stocks in my portfolio. Their next annual meeting is September 11, 2014. ProxyDemocracy.org had collected the votes of two funds when I checked and voted on 9/7/2014. I also checked the votes of OTPP and CalSTRS. All advance disclosers that I know of except CBIS voted in favor of all items. I voted with the Board’s recommendations 54% of the time and assigned them a proxy score of 54. View Proxy Statement. Read Warnings below. What follows are my recommendations on how to vote the H&R Block proxy in order to enhance corporate governance and long-term value.
The July 2014 edition of Corporate Governance: An International Review contains four research papers, all dealing with firms outside the US and UK, which usually get most of the attention. Still, insights from these studies could help efforts around the globe, including the US and UK.
Monitoring in Japan
Facebook $FB, is one of the stocks in my portfolio. Their annual meeting is coming up on 5/22/2014. ProxyDemocracy.org had collected the votes of two funds when I checked and voted on 5/19/2014. I voted with management 0% of the time. View Proxy Statement. Read Warnings below. Continue Reading →
Guest Post by Shari Dunn is an attorney and journalist who is also a “True Believer,” Bon Vivant, Raconteur, Creative, Dreamer and Muse.
Never believe that a few caring people can’t change the world. For indeed, that’s all who ever have.
That’s one of Dunn’s favorite quotes from Margaret Mead. In this guest post (originally posted at Tweeting For Change, she interviews Julie Goodridge, CEO of NorthStar Asset Management, one of the primary movers behind a group that recently came to my defense after I was sued by several companies for simply fling shareowner proposals. See SRI Funds & Advisors Send Open Letters on Lawsuits Against Shareholders. Here, Shari Dunn talks to Julie Goodridge about owners taking participation to the next level. Continue Reading →
In a speech to the 26th Annual Corporate Law Institute held at Tulane University Law School on Federal Preemption of State Corporate Governance, SEC commissioner Daniel Gallagher delivered a scathing attack on small investors and proposed radical steps to severely limit democracy in corporate governance.
Gallagher opened his attack by stating,
Activist investors and corporate gadflies have used these loose rules to hijack the shareholder proposal system. Continue Reading →
The thesis of this book argues that national corporate governance is extremely important for societies. Recently many scholars have said that a convergence of corporate governance is inevitable. We believe that it is true but like Mark Twain said “the reports of my death are greatly exaggerated.” We show that although there is some convergence, national law of corporate governance is thriving. We also believe that it is necessary for the identity of each country. The reason that national diversity in corporate governance is still widespread is because of the history, philosophy and economy of each county as shown in its cultural heritage, and which it gives its identity. The cultural heritage in each state is identifiable in the company law and corporate governance codes. We consider that this is crucial for the well being of democratic nations. Convergence in corporate governance is a threat to ordered commercial regulations because of the power of the preeminent economic paradigm in the West which is the neo-liberal model. The neo-liberal agenda that predicates deregulation, privatisation and the liberalisation of markets is moulding many jurisdictions into an Anglo- American model of corporate governance which is dangerous for a number of reasons: Continue Reading →
Guest Post from Stephen M. Davis, Ph.D. is associate director of the Harvard Law School Programs on Corporate Governance and Institutional Investors, and a senior fellow at the Program on Corporate Governance. He is also a nonresident senior fellow in governance at the Brookings Institution. From 2007-2012 he was executive director of the Yale School of Management’s Millstein Center for Corporate Governance and Performance and Lecturer on the SOM faculty. Continue Reading →
Moderator: Jesse Eisinger, reporter at ProPublica, covering Wall Street and finance. Panelists: Martin Redish, NU Law; Robert A. Weinberger, Senior Fellow, Aspen Institute Initiative on Financial Security; former VP Government Relations, H&R Block; Chairman, Center for Responsive Politics; Lynn Stout, Cornell Law; Nell Minow, founder of GMI Ratings and co-founder and editor of the Corporate Library, a research firm for oversight on corporations and executive compensation. Continue Reading →
Guest post from Jeffrey Clements.
Make no mistake, the impact of the Supreme Court’s fiasco in Citizens United v. FEC on the elections and our government was even worse than predicted. That’s the bad news. The good news is that the forces of reform, led by the growing movement for a 28th Amendment to the US Constitution, also made a forceful showing in November. Continue Reading →
Last week, investors announced filing shareholder resolutions at more than 50 corporations as part of a 2013 proxy season initiative asking companies to annually report their federal and state lobbying, including any payments to trade associations used for lobbying as well as support for tax-exempt organizations that write and endorse model legislation.
As we look back on the 2012 elections one thing is clear, money flowed like water with any barrier that might have contained it removed by Citizens United. Writing for the court in the 5-4 decision, Judge Kennedy opined:
With the advent of the Internet, prompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions and supporters. Shareholders can determine whether their corporation’s political speech advances the corporation’s interest in making profits, and citizens can see whether elected officials are ‘in the pocket’ of so-called moneyed interests. Continue Reading →
The SEC recently updated its entry in the Office of Management and Budget’s Unified Agenda to indicate that, by April, it plans to issue a Notice of Proposed Rulemaking to require public companies to disclose their spending on politics. This is huge! Perhaps petitions, accompanied by thousands of e-mails from supporters, actually can have an impact. Congratulations to Bebchuk and Jackson, co-chairs of the Committee on Disclosure of Corporate Political Spending. See their post at HLS corpgov site. Continue Reading →
Companies that tout social responsibility and whose managers contribute to political action committees tend to provide higher returns to shareholders, suggests a new University of California,
Davis, study Strange Bedfellows? – Voluntary CSR Disclosure and Politics. Continue Reading →
Guest post from Kent Greenfield. Author, ‘The Myth of Choice’; law professor at Boston College. This article is adapted from a more substantial essay in the Fall 2012 issue of Democracy: A Journal of Ideas and appeared previously on Huffington Post, 9/15/2012.
Corporations determine far more than any other institution the air we breathe, the quality of the water we drink, even where we live. Yet they are not accountable to anyone.
Those words were on the 1991 cover of Power and Accountability: Restoring the Balances of Power Between Corporations and Society by Robert A.G. Monks and Continue Reading →