Are CEO Political Donations Linked to the Risk of SEC Enforcement Actions?

The potential for corporate campaign contributions to skew government policy has attracted considerable attention. Empirical studies generally support the notion that firms gain regulatory advantages through their involvement in the political process (e.g., Correia, 2014; Naughton, Rogo and Zheng, 2021). The notion that corporations also benefit financially from political influence has led to demands for making  their lobbying more transparent (e.g., Bebchuk, Jackson, Nelson, and Tallarita, 2020), both to protect shareholders and to uphold the integrity of the U.S. political system. In contrast, individual donations by executives are believed to be relatively benign, seen generally as motivated by ideology rather … Read more