The Securities and Exchange Commission conducted a hearing Wednesday to determine whether it should promulgate new disclosure rules for public companies. On hand was Laura Berry, executive director, the Interfaith Center on Corporate Responsibility, a New York-based watchdog group.
Ms. Berry was joined by a host of other liberal/progressive representatives working hard to undermine First Amendment rights bolstered by the U.S. Supreme Court’s 2010 decision in Citizens United. Berry and her cohorts – Sen. Robert Menendez (D-NJ); Sen. Elizabeth Warren (D-Mass.); Professor Robert Jackson, Columbia Law School; Professor John Coates, Harvard Law School; Pat Doherty, Office of the New York State Comptroller; Heidi Welsh, Sustainable Investments Institute – argued that 600,000 letters were submitted to the SEC backing up their demands for more corporate disclosure.
As noted by the Center for Competitive Politics, a non-profit, tax-exempt organization in Alexandria, Va., that works to protect free speech, this assertion – and the underlying premises that are employed to defend – are completely false:
Our analysis found less than .01% of these submissions to be “substantive” letters containing unique text and coherent arguments from independent perspectives that were not duplicates, without complete names, or using form text.
99.71% of the comment letters stem from nine different form letters from union and Soros-funded entities, which have posted SEC submission links on their websites.
These groups including AFSCME, Public Citizen, Common Cause, CREW, CREDO, and NYC Mayoral Candidate Bill de Blasio’s Coalition for Accountability in Spending do not have an economic interest in the well-being of U.S. public companies. Rather, they are driving an astro-turf campaign to deceptively suggest investors care about disclosure issues, when in reality over 80% of shareholders reject these ideas year after year.
Their ultimate goal is to tilt the public policy playing field to the favor of unions and other labor groups who will not be required to play by the same rules as the SEC. They will use disclosure to name and shame companies out of the public policy playing field. This is not about material issues to investors concerned about retirement savings and economic growth, this is an ideological partisan movement of activists bent on pushing policies through whichever body they can deceive. Failing in Congress, the courts, and through the proxy process, they are now looking to the SEC.
The effort to make the IRS into a campaign finance law enforcement agency created one of the worst scandals in IRS’s history. Today’s effort to draw the Securities and Exchange Commission into regulating political speech shows that many have failed to learn the valuable lesson from the IRS scandal – don’t ask agencies to do jobs they don’t know how to do. The SEC is ill-suited to police speech and efforts to drag the agency into this arena are fraught with danger. It would sidetrack the SEC from its mission of protecting investors and threaten First Amendment rights.
As for the comments to the SEC, these are ginned up by partisans with a political agenda. Fewer than .01% of the 640,000 comments contain unique text and relevant arguments. Citizens and lawmakers benefit from more speech and more information, not less. The SEC should learn from the IRS scandal and stay out of regulating political speech and focus on its mission.
One hopes Ms. Berry and the host of religious, clergy and nuns affiliated with ICCR recognize that their proxy resolutions and activities for more corporate disclosure before the SEC have nothing to do with matters of religious faith and everything to do with shutting down political speech employing mendacious and misleading tactics.
Or at least the SEC should recognize that.