Big names come clean on political donationsApril 2008
Five major US companies have agreed to disclose all donations to political parties after a concerted campaign by shareholders.
American Express, Capital One, Texas Instruments, Washington Mutual and Xerox will report publicly any payments to trade associations and other tax-exempt groups that direct money to political parties.
They decided on their stance after shareholder activists tabled resolutions that called for complete transparency on political donations.
The campaign was led by the Washington-based non-profit Center for Political Accountability, which attracted support from, among others, Domini Social Investments and NorthStar Asset Management.
US law prohibits companies from contributing to federal candidates, but corporations can give through other channels. The Center for Political Accountability claims much of this spending is undisclosed or reported haphazardly, ‘leaving institutional investors and individual shareholders in the dark about the use of company resources for political activities’. However, estimates suggest that during 2002, the last main election cycle, corporate donations stood at $184m (£92m) – more than a third of all campaign contributions.
While levels of donations vary from company to company, American Express recently revealed that it spent $135,000 on political donations in 2007.
The presidential election campaign this year is expected to attract around $1billion through tax-exempt groups, though the majority of that will be from individuals.
The Center for Political Accountability said the five companies’ transparency policies amounted to ‘the new gold standard among corporations that disclose their political spending’. The companies have also agreed to publish related policies and procedures and to make their boards aware of proposed political gifts. All information will be available on their websites.
So far 38 other companies have adopted similar transparency measures since the Center for Political Accountability began campaigning in late 2003, among them Bristol-Myers Squibb, Eli Lilly, Lockheed Martin, Morgan Stanley, Staples and UPS.
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