(WASHINGTON, D.C.) – Today, Congressman Jamie Raskin (MD-08) introduced the Shareholders United Act, H.R. 936, to control billions of dollars in corporate political spending and put power back in the hands of the shareholders.
The Shareholders United Act would prevent corporate expenditures for campaign purposes unless the corporation has established a process for determining the political will of its majority shareholders.
If a corporation has no such process or is unable to assess the “majority will” of shareholders because the majority of shares are owned by entities that are prohibited from registering a political preference - such as states and cities, pension and mutual funds, universities, charities, or foundations – then the corporation will be prohibited from using its resources on political campaigns.
The majority of shares of Fortune 500 companies are actually owned by institutional investors prevented from engaging in partisan political activity because of federal or local law, their tax status, contract, or fiduciary duty.
“If most company shares are owned by entities forbidden to be involved in politics, the CEO literally has no one to speak for,” Raskin said. “Money should not be taken from shareholders and their owners to make political statements they are prevented by law from making.”
Raskin emphasized that even where shareholders have a right to speak on political campaigns, no one should be able to use their money without their explicit involvement and consent.
“Shareholders should not be kept in the dark about political expenditures in their name,” said Raskin. “Shareholders United will make certain that corporations only become political actors if majority shareholders want them to.”
Unlike campaign contributions made by individuals, which are capped by law and require public disclosure, political expenditures by corporations have no such constraints. The Citizens United decision that opened the campaign finance floodgates not only permits corporations to contribute unlimited sums of money to influence our elections, it also allows them to funnel money to shadowy outside groups, effectively avoiding disclosing the source of the contribution.
“We recently marked the 9th anniversary of the disastrous 5-to-4 decision that gave the green light for every corporate treasury to be transformed into a political slush fund, and I am proud to stand with colleagues advancing a bipartisan constitutional amendment to reverse Citizens United,” Raskin continued. “But while we build power to advance an amendment, we can empower shareholders right now to decide if they want their money spent on politics.”
In Citizens United, Raskin noted, Justice Anthony Kennedy argued that shareholders had the power to object to corporate political spending through the “procedures of corporate democracy” and would be given prompt notice of corporate political expenditures.
“Let’s make Kennedy’s promise real,” Raskin said.
The legislation has also earned the support of good government groups such as People for the American Way, End Citizens United, and Public Citizen.
“Public Citizen has long supported shareholders- the true owners of the wealth of corporations- having a say in how their money is spent in politics," said Lisa Gilbert, Public Citizen's Vice President of Legislative Affairs. "We applaud Congressman Raskin on this groundbreaking new legislation.”
The Shareholders United Act has nine cosponsors, including Reps. Harley Rouda (CA-48), Hank Johnson (GA-4), Salud Carbajal (CA-24), Eleanor Holmes Norton (DC-At-Large), Jan Schakowsky (IL-9), Darren Soto (FL-9), Earl Blumenauer (OR-3), Mark Pocan (WI-2), and Gil Cisneros (CA-39).
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