Lucian 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 co-chairs of the Committee on Disclosure of Corporate Political Spending, which filed a rulemaking petition requesting that the SEC require all public companies to disclose their political spending. 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.
We are pleased to report that a bipartisan group of three distinguished former SEC Commissioners—former Chairman William Donaldson, former Chairman Arthur Levitt, and former Commissioner Bevis Longstreth—last week submitted to the SEC a letter urging the Commission to move forward with the rulemaking we proposed in our petition on corporate political spending. We are delighted that this distinguished group of former Commissioners is adding its voice to the massive and unprecedented support that the petition has already received.
In July 2011, we co-chaired a committee of ten corporate and securities law experts that submitted a rulemaking petition urging the SEC to develop rules requiring public companies to disclose their political spending. The SEC has thus far received more than 1.2 million comments on the proposal—more than any rulemaking petition in the SEC’s history.
The three former SEC Commissioners who have now come out in support of our petition bring a rich and telling set of perspectives and experiences to this issue. William Donaldson, a Republican, was appointed by President George W. Bush after having previously served in the Nixon Administration and served as SEC Chairman from 2003 to 2005. Arthur Levitt, a Democrat, was appointed by President Bill Clinton and served as SEC Chairman from 1993 to 2001. And Bevis Longstreth, a Democrat, was twice appointed to the SEC by President Ronald Reagan, serving as a Commissioner from 1981 to 1984.
As we have discussed in previous posts on the Forum, the case for rules requiring disclosure of corporate political spending is compelling. Unfortunately, Chairman Mary Jo White has faced significant political pressure not to develop such rules, and the Commission has so far chosen to delay consideration of rules in this area. The delay is unfortunate and unwarranted in light of the strong arguments for disclosure put forward in the rulemaking petition and the remarkable and broad support that the petition has received. Moreover, as we showed in our article Shining Light on Corporate Political Spending an examination of the full range of objections that opponents of such rules have so far been able to raise indicates that these objections, both individually and in combination, fail to provide an adequate basis for opposing such rules.
In the letter submitted last week by the bipartisan group of three distinguished former SEC Commissioners, the authors opined that it is a “slam dunk” for the SEC to move forward with rules that would shine light on corporate spending on politics. We are delighted that these distinguished former Commissioners share our view that the case for mandating disclosure of corporate political spending is compelling. The SEC should proceed with rulemaking in this area without further delay.
