As has been widely reported, the Securities and Exchange Commission (“SEC”) recently made some rumblings about undertaking a rulemaking requiring corporations to disclose their funding and participation in political activities to shareholders. The move has been heralded by corporate governance reform groups and decried by some from the business sector. But what exactly does this all mean in practice?
For starters, we should be clear on exactly what the SEC did. In August 2011, a group of academics filed a Petition for Rulemaking asking the agency to “develop rules to require public companies to disclose to shareholders the use of corporate resources for political activities.” No action was taken until a few weeks ago, when the SEC asked the Office of Information and Regulatory Affairs (“OIRA”)—housed within the Office of Management and Budget as part of the Executive Office of the President—to note a proposed rule on the semi-annual, federal-government-wide “Unified Agenda,” along with dozens of other agenda items on a variety of topics the SEC might tackle over the next year.
SEC Rulemaking on Corporate Political Spending Disclosure
