2:02pm

Thu October 27, 2011
Politics

More Corporations Shed Light On Political Spending

For the first time, 100 of America's biggest corporations are being rated on the transparency of their political activities.

On Friday, the Wharton School at the University of Pennsylvania and the nonpartisan Center for Political Accountability will release an index that ranks the S&P 100 companies. The rankings come as politicians employ new loopholes — and the Supreme Court's Citizens United decision — to solicit secret, million-dollar contributions from corporate donors.

Much of that money is thought to go to groups that don't have to disclose their donors — trade associations like the U.S. Chamber of Commerce, and 501(c)(4) organizations like the pro-Republican Crossroads GPS and newer pro-Democratic groups trying to get off the ground.

This doesn't jibe with what the Supreme Court thought would happen.

Justice Anthony Kennedy, who delivered the ruling on Citizens United, talked about the importance of disclosure: "The resulting transparency enables the electorate to make informed decisions, and give proper weight to different speakers and different messages."

But in the wake of the Supreme Court ruling, Congress failed to pass a disclosure law — so corporate shareholders and the public were left in the dark.

As it turns out, corporations weren't necessarily happy about the secrecy either. The new index shows that most S&P 100 companies now have formal policies to handle fundraising solicitations and to disclose what they spend.

"Companies are under tremendous pressure today on political spending. Disclosure and board oversight really are a way for companies to manage that risk," says Bruce Freed, the head of the Center for Political Accountability.

Freed says that in the S&P 100, "57 companies disclose and have board oversight of their direct political spending; 43 of the companies disclose trade association payments either in full or partially."

The new index gives top scores to four companies — Colgate Palmolive, the utility company Exelon, IBM and Merck.

Tied for last place are 14 companies, which all get a zero. Among them are Amazon, Wal-Mart, Disney and Warren Buffett's Berkshire Hathaway.

Dan Bross, a senior director of corporate citizenship at Microsoft — No. 19 on the index — says many companies learned a lesson from Target in 2010. The chain store hurt its progressive, multicultural image by supporting a state candidate who opposed marriage equality.

"I believe that if companies have developed a set of principles and then policies to support those principles, problems or situations like Target found themselves in could be easily avoided," he says.

Bross has helped to write political money guidelines for corporations in a project by the Conference Board, an organization best known for its economic data.

Last week, the Conference Board held a symposium in New York — a chance for corporate executives to talk about what their companies have done.

Charles Grezlak, head of government affairs for the drugmaker Merck, said, "we need trust among consumers, we need trust among physicians who prescribe our products."

Bruce Wilson, a senior vice president with Exelon, said that allowing people "to look behind the curtain to see what's going on, whether they're a consumer or an investor, we think is generally a good thing."

Now, this still isn't nirvana for disclosure advocates: Corporations make their own decisions about what they will or won't disclose, and they post new data only once or twice a year.

But conservative critics of disclosure don't like it either. At the symposium, campaign finance lawyer Stefan Passantino invoked the old saying that sunlight is the best disinfectant. And he added this: "Sometimes sunlight is a disinfectant, and sometimes sunlight causes cancer."

The conservative argument against disclosure rests on a Supreme Court case from the 1950s, in which Alabama officials wanted to shut down the NAACP by exposing its members and organizers.

Passantino admitted it's not a great analogy, suggesting that corporations that supply politicians with seven-figure checks are like civil rights workers who were beaten or killed in the old Jim Crow South.

Copyright 2011 National Public Radio. To see more, visit http://www.npr.org/.

Transcript

MELISSA BLOCK, host: For the first time, 100 of America's biggest corporations are being rated on the transparency of their political activities. Tomorrow, the Wharton School at the University of Pennsylvania and the nonpartisan Center for Political Accountability will release an index that ranks the S and P 100 companies.

As NPR's Peter Overby reports, the index comes as politicians take advantage of new loopholes and of the Citizens United decision to solicit secret million-dollar contributions from corporate donors.

PETER OVERBY: Millions of corporate dollars are thought to go to groups that don't have to disclose their donors. Trade associations like the U.S. Chamber of Commerce, and 501(c)(4) organizations like the pro-Republican Crossroads GPS and newer pro-Democratic groups trying to get off the ground.

This doesn't jibe with what the Supreme Court thought would happen. Justice Anthony Kennedy delivered the ruling on Citizen's United and he talked about the importance of disclosure.

Justice ANTHONY KENNEDY: The resulting transparency enables the electorate to make informed decisions and give proper weight to different speakers and different messages.

OVERBY: But in the wake of Citizens United, Congress failed to pass a disclosure law, so corporate shareholders and the public were left in the dark. And it turns out, corporations weren't necessarily happy about the secrecy either. The new index shows that most S and P 100 companies now have formal policies to handle fundraising solicitations, and to disclose what they spend. Bruce Freed is director of the Center for Political Accountability.

BRUCE FREED: Companies are under tremendous pressure today on political spending. Disclosure and board oversight really are a way for companies to manage that risk.

OVERBY: He says that in the S and P 100...

FREED: Fifty-seven companies disclose and have board oversight of their direct political spending, 43 of the companies disclose trade association payments either in full or partially.

OVERBY: The new index gives top scores to four companies - Colgate Palmolive, the utility company Exelon, IBM and Merck. Tied for last place, 14 companies, which all get a zero. Among them are Amazon, Wal-Mart, Disney and Warren Buffett's Berkshire Hathaway.

At Microsoft, number 19 on the index, Dan Bross says many companies learned a lesson from Target in 2010. The chain store hurt its progressive, multicultural image by supporting a state candidate who opposed marriage equality. Bross oversees corporate citizenship at Microsoft.

DAN BROSS: I believe that if companies have developed a set of principles, and then policies to support those principles, problems or situations, like Target found themselves in, could be easily avoided.

OVERBY: Bross has helped to write political money guidelines for corporations. It's a project by the Conference Board, an organization best known for its economic data. Last week, the Conference Board held a symposium in New York, a chance for corporate executives to talk about what their companies have done. Charles Grezlak is head of government affairs for the drugmaker Merck.

CHARLES GREZLAK: We need trust among consumers. We need trust among physicians who prescribe our products.

OVERBY: And Bruce Wilson is a senior vice president with Exelon.

BRUCE WILSON: Having people know, you know, be able to look behind the curtain to see what's going on, whether they're a consumer or an investor, we think is generally a good thing.

OVERBY: Now, this still isn't nirvana for disclosure advocates. Corporations make their own decisions about what they will or won't disclose, and they only post new data once or twice a year. But conservative critics of disclosure don't like it. At the symposium, campaign finance lawyer Stefan Passantino invoked the old saying that sunlight is the best disinfectant. And he added this.

STEFAN PASSANTINO: Sometimes sunlight is a disinfectant, and sometimes sunlight causes cancer.

OVERBY: The conservative argument against disclosure rests on a Supreme Court case from the 1950s. Alabama officials wanted to shut down the NAACP by exposing its members and organizers. Passantino admits it's not a great analogy, suggesting corporations that supply politicians with seven-figure checks are like civil rights workers who were beaten or killed in the old Jim Crow South.

Peter Overby, NPR News, Washington. Transcript provided by NPR, Copyright National Public Radio.