Investor Activism and the Call for Political Spending Transparency

A decade ago, the U.S. Supreme Court changed the rules on how businesses could donate to political campaigns. Since then, hundreds of millions of corporate dollars have been spent on local, state, and federal elections, often without transparency. Many CEOs and boards feel this is the only way they can curry favor with policymakers. Dorothy Lund, an associate professor of law at the University of Southern California, and Leo Strine Jr., counsel at Wachtell, Lipton, Rosen, and Katz and a former Chief Justice of the Supreme Court of Delaware, say this isn't just bad for democracy. It's bad for business because it distracts companies from innovation and growth and risks serious backlash from consumers, employees, and shareholders. They suggest ways to dial back corporate political spending and improve the economy for all. They are the authors of the HBR article "Corporate Political Spending is Bad Business: How to Minimize the Risks and Focus on What Counts.”