Corporate Influence in Politics

American corporations spend hundreds of millions of dollars each year to support candidates and shape policy at both the state and national levels. While US laws prevent companies from making direct contributions to federal candidates or national political parties, companies are permitted to make partisan donations — for example to support or oppose a specific candidate — as long as the funding is independent from that candidate’s committee. Companies may also give to political committees such as the Republican and Democratic Governors Associations, trade associations, or other nonprofits, none of which are required to disclose their funding sources. Corporations may also fund Super PACs, which have no limitations on how much money they can accept or disburse.

A lack of transparency obfuscates the true sources of influence in political elections. This ‘dark money’ undermines accountability on how companies spend shareholder money. It also calls into question elected officials’ policymaking on issues such as climate change, taxation, redistricting, criminal justice reform and LGBTQ rights. Some companies have even found themselves donating to campaigns or candidates whose platforms clash with their corporate values.

Methodology

The Center for Political Accountability (CPA), a nonpartisan, nonprofit public policy organization, has been working on corporate political transparency and accountability since 2003. In conjunction with the Zicklin Center for Business Ethics Research at the University of Pennsylvania, the CPA has developed a rigorous rating system to grade companies in the S&P 500 on how transparently they disclose their contributions to activities that aim to influence policy. The Center also works directly with companies by encouraging them to clearly disclose how they choose to influence policy. Some firms have decided to prohibit the use of corporate funds for political ends, while on the other end of the spectrum, some chose to keep their contributions secret. OpenInvest relies on the CPA-Zicklin Index to identify companies that are going above and beyond in the name of political accountability, and those choosing to remain in the shadows.

Additional Information

Center for Political Accountability

Collision Course (Report from the CPA)

Track Your Company

Open Secrets

Brennan Center for Justice