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E-MailLucian Bebchuk is Professor of Law, Economics, and Finance at Harvard Law School. Robert J. Jackson, Jr. is Professor of Law at Columbia Law School. Bebchuk and Jackson served as the principal draftsmen of the rulemaking petition that the Committee on the Disclosure of Corporate Political Spending submitted to the SEC. Bebchuk and Jackson are also co-authors of Shining Light on Corporate Political Spending, published in the Georgetown Law Journal. A series of posts in which Bebchuk and Jackson respond to objections to an SEC rule requiring disclosure of corporate political spending is available here. All posts related to the SEC rulemaking petition on disclosure of political spending are available here.
In a New York Times DealBook column published today, Hindering the S.E.C. From Shining a Light on Political Spending, we discuss the addition to the omnibus budget agreement of a rider to prevent the SEC from issuing next year a rule that would require public companies to disclose their political spending. This unusual Congressional intervention in S.E.C. rulemaking, we argue, is a troubling development both for investors and for the agency.
In July 2011 we co-chaired a bipartisan committee of 10 corporate and securities law professors that considered this issue and submitted to the SEC a rule-making petition urging the development of rules requiring public companies to disclose their spending on politics. To date, the agency has received more than 1.2 million comments on the proposal—far more comments than those submitted on any rule-making petition in its history.
With submissions to the SEC expressing overwhelming support for the petition, the rider reflects opponents’ interest in avoiding a debate on the merits. The rider also hurts the standing of the S.E.C., and undermines the critical premises upon which the Supreme Court has relied in its Citizens United decision.
The column is available here.
