On November 18, 2019, Securities and Exchange Commission (the “SEC”) Commissioner Robert Jackson sent a letter to Representative Carolyn Maloney attributing the lack of public disclosure regarding the political spending habits of public companies to the influence of institutional investors. Commissioner Jackson publicly supported imposing corporate political spending disclosure requirements on public companies prior to his joining the SEC in 2018. In the letter, Commissioner Jackson noted that institutional investors, which vote large blocks of public company securities, tend to vote against shareholder proposals that would require disclosure of a public company’s political spending practices. Institutional investors provide little explanation of their voting decisions or their voting track record on corporate political spending shareholder proposals to investors or the general public. Commissioner Jackson raised the concern that if investors do not understand how institutional investors vote on shareholder proposals that would require disclosure of corporate political spending then they will be unable to insist upon transparency and accountability. As a result, the letter advocates for legislation that would require public companies to disclose whether and how they spend money received from shareholders on politics. Commissioner Jackson’s term with the SEC expired in June and he is expected to leave the SEC in 2020. A copy of Commissioner Jackson’s letter can be found here.

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