U.S. Supreme Court Justice Anthony Kennedy observed in the Citizens United decision that shareholders of publicly traded companies could employ the procedures of corporate democracy to ensure that shareholder value was not diverted to political causes and candidates that they found objectionable.  The proxy process is the principal way shareholders can exercise that power.

Investors have used the process to file resolutions seeking disclosure and board oversight of corporate political spending and have met with remarkable success: Political transparency and accountability are becoming the norm among publicly traded companies.

Today, the right of shareholders to register their opinion about companies’ use of their investment dollars for political causes is at risk.  Securities and Exchange Commission Chairman Paul Atkins and the Trump administration are pushing to eliminate proxy resolutions that are advisory, which would be a fatal blow to resolutions calling for political transparency and board oversight.

Proxy access is critical to protecting investors.  Investors should not be deprived of the ability to recommend to a company procedures that safeguard their investment and align their interests with the company’s. Investors simply should not be put at risk of having shareholder value used to advance political causes and candidates without disclosure and approval by elected directors.

Broad transparency and accountability by major companies are products of proxy access.  Without proxy access, shareholders would not be able to take advantage of Justice Kennedy’s observation and would be left blind to a company’s political engagement and compelled to underwrite speech that they find objectionable.

Transparency and accountability serve as a check on corporate managers using corporate resources to advance their own personal political preferences.

Transparency and board oversight also serve as a safeguard against corruption.  Recent experience is replete with examples of corporate officers using corporate resources to corruptly engage in politics.  Corruption puts at risk a shareholder’s investment and financial fortune at risk.

The S.E.C.’s proxy access rules have been central to the Center for Political Accountability’s  successful collaboration with shareholder advocates in engaging companies to improve disclosure and oversight of their election-related spending. The fact that its resolution has garnered very substantial investor support –a 41.6 percent average vote in the 2025 proxy season — is testament to the value investors place on political engagement that is transparent and accountable.

At the same time proxy access has facilitated dialogue between management and investors, helping to remove suspicion and identifying common concerns.  The resolution has been regularly withdrawn at companies following constructive engagement and adoption of responsive policies.

Demonstrating the value of proxy access, this year’s proxy season shareholders exercised their right and rendered a notable five majority votes on resolutions for corporate political disclosure and accountability, at the following companies: Meritage, 57.7 percent; CBOE Global Markets Inc., 55.8 percent; Crown Holdings Inc., 52.7 percent; Spirit AeroSystems, 51.4 percent; and Teradyne Inc., 51.0 percent.

These results show that political transparency and accountability are not gadfly concerns but reflections of investor recognition of the risks associated with political spending and the obligation that a company owes to its investors to reveal and justify the company’s use of shareholder value to advance a political cause or candidate.

It is hard to discern how investors benefit from denying them an effective way to register their opinions with a company on issues of high public and personal and financial interest.  The Constitution protects us from being compelled to support political speech with which we disagree.  It is difficult to take advantage of that right if no avenue is left open to vindicate it.  It is that avenue that Justice Kennedy was presuming would be left open.  The SEC should take heed of that opinion.

Karl Sandstrom is Senior Advisor to the Center for Political Accountability and a former member of the Federal Election Commission. Bruce Freed is President of the Center for Political Accountability.