From Congressman Capuano’s weekly email update:
Shareholder Protection Act
This week I reintroduced the Shareholder Protection Act with Senator Robert Menendez, which requires CEOs to seek authorization from a majority of shareholders before a corporation can spend money from its general treasury on political activities. It also requires the disclosure of these expenditures. The legislation has 24 original cosponsors.
I first filed this bill in 2010, following the Supreme Court’s decision in Citizens United v. FEC, which fundamentally re-wrote the nation’s campaign finance laws. When the court ruled that corporations should be treated as persons under the First Amendment with regard to election spending, it gave corporations an outsized voice in the political process. This decision allows corporations to overshadow the voice of the voter.
The Shareholder Protection Act of 2013 would require a majority of shareholders to authorize an overall political budget before general treasury funds can be spent on political activities. The Board of Directors must also vote to authorize expenditures over $50,000 within the overall budget approved by shareholders. It also requires that corporate political spending be disclosed to shareholders, the SEC, and the public on a quarterly basis, and board approval of significant expenditures disclosed on-line within 48 hours. I look forward to continuing to build support for this much-needed legislation.
We missed you, and this is an incredibly important piece of legislation. I doubt it would pass muster with the same court that decided Citizens United, but it is a step in the right direction and a neat end run around the constitutional questions, the need for an amendment, etc. I’ve always said if the ‘NASCAR Suit’ option passed or simply ‘Wal mart and I approve this message”, it would add transparency to the process. A good chunk of shareholders these days are socially liberal, a good number are women, and I doubt they want their shares wasted on radical conservative politics. We have a right to know.
They said corporations have First Amendment rights. Fine. But I don’t see how one could justify not only saying that corporations have unlimited First Amendment rights but also that those corporate speech rights rest exclusively with their officers or board, and not with their shareholders.
There’s a whole body of corporate law that makes corporations accountable to their shareholders. And regulating which kind of activities require shareholder approval is certainly the kind of thing legislation can do.