New CPA-Zicklin Index Reveals Companies Adopting Political Disclosure on Their Own
WASHINGTON, D.C.—On their own initiative, dozens of leading American corporations are embracing disclosure of their spending to influence political elections. These companies are supporting disclosure even as several of the biggest trade associations oppose it, according to a nonpartisan index released today.
As the nation approaches mid-term elections that may be the most expensive in history, the Center for Political Accountability issued its fourth annual CPA-Zicklin Index of Corporate Political Disclosure and Accountability.
The Index shows that a majority of almost 200 publicly held companies that were examined in both 2013 and 2014 received higher overall scores for political disclosure and accountability this year. The average overall score for these 102 companies improved by an average of 12.5 points.
For the first time, the Index was expanded this year to look at the policies and practices of the top 300 companies in the S&P 500. In these top echelons of American business, the Index finds that 60 percent of companies are disclosing voluntarily at least some political spending made to candidates, parties, and political committees; and almost half have opened up about payments made to trade associations.
In addition, the Index reveals that voluntary disclosure is making inroads among public companies that have not been formally engaged by shareholders to disclose. Of the 139 companies with no history of shareholder resolution on the issue, 34 disclose full or partial information on their direct expenditures or say they do not make such expenditures. Some also disclose their payments to 501(c)(4) groups and trade associations.
“This nonpartisan Index, established and reviewed by academic experts, definitively shows that more leading companies are establishing political disclosure as a mainstream corporate practice,” said Bruce Freed, CPA president.
“Whether one is politically conservative or politically liberal (or a solid centrist), the Index should be a welcome contribution to the transparency and disclosure movement that is growing in the wake of the U.S. Supreme Court’s 2010 Citizens United decision,” wrote Charles Kolb, former president of the Committee for Economic Development, in a foreword. Kolb served as a domestic policy adviser in the White House under President George H.W. Bush.
“The 2014 Index offers solid evidence of a growing momentum among American corporations to disclose the details of their political spending,” Kolb wrote. “As a board member of the Center for Political Accountability, I sincerely hope that the 2014 Index receives wide attention from the American public, our corporations and labor unions, and from the media.”
Data from 2014 Index yields these other striking findings:
- Among the top 300 companies in the S&P 500, 20 receive top-five rankings for political disclosure and accountability.
- Two companies tie for a first-place ranking with a score of 97.1 points, the highest in the four-year history of the Index: Noble Energy, Inc. and CSX Corp.
Other top five companies include Becton, Dickinson & Co.; Capital One Financial Corp.; Exelon Corp.; Qualcomm, Inc.; United Parcel Service Inc., AFLAC Inc.; Edison International; Microsoft Corporation; Morgan Stanley; PG&E Corp. (Holding Company); Gilead Sciences, Inc.; Intel Corp.; Mylan Inc., Norfolk Southern Corp.; Hershey Company (The); Merck & Co., Inc.; and Time Warner Inc.
- Companies showing the greatest improvement from 2013 to 2014 are Applied Materials, Inc., improving from an overall score from 7.1 to 72.9; BlackRock, Inc., raising its total score from zero to 65.7; and Schlumberger Ltd., receiving a score of 95.7, up from 38.6.
“Leading public companies are standing up for sunlight. They’re effectively laying a foundation for a new route to political disclosure and accountability at a moment when our established political disclosure systems have collapsed, and dark money threatens to become the chief political currency,” Freed said.
The fourth annual CPA-Zicklin Index of Corporate Political Accountability and Disclosure [embed link] was released in conjunction with the Carol and Lawrence Zicklin Center for Business Ethics Research. The Zicklin Center is located at The Wharton School of the University of Pennsylvania.
The annual benchmarking study examines policies and practices published on corporate websites. Its accompanying report does not make any judgments about a company’s political spending or whether its disclosure is complete. The report is entitled The 2014 CPA-Zicklin Index of Corporate Political Accountability and Disclosure: How Leading Companies are Making Political Disclosure a Mainstream Practice.”