Corporate Governance and Transparency: Covering Companies from Washington

National Press Foundation Paul Miller Fellows September 2012

How To
• Decipher CEO pay packages by looking at “proxy statements” or “Form 990s”. • Match PAC contribution data and lobbying disclosure to corporate agendas. • Learn from SEC filings what legislation/regulation companies want/fear. • Feed the data into coverage; spot and enterprise

Big Picture
COST OF THE 2012 ELECTION

$5.8 BILLION
(Projected)

Source: OpenSecrets.org

Cycle

Total Cost of To Dems Election
$5.8 Billion $3.6 Billion $5.3 Billion $2.8 Billion $4.1 Billion n/a $1.8 Billion $3 Billion

To Repubs

% to Dems

% to Repubs

2012* 2010 2008* 2006 2004*

n/a

n/a

n/a 49% 42% 51% 47%

$1.77 Billion 50% $2.2 Billion 57%

$1.36 Billion $1.44 Billion 48% $2.1 Billion $1.9 Billion 52%

2002
2000

$2.1 Billion
$1.6 Billion

$977 Million $1.18 Billion 45%
$1.3 Billion $1.6 Billion 43%

54%
54%

Source: OpenSecrets.org

Where does the money come from?
• • • • • Unions Corporations Associations Individuals Lobbyists

Top Corporate Donors in 2008
• • • • • • • • Goldman Sachs - $7 Million AT&T - $5.9 Million JPMorgan Chase & Co. - $5.8 Million Citigroup Inc. - $5.7 Million General Electric - $4.3 Million Morgan Stanley - $4.3 Million Microsoft Corp - $4 Million Comcast Corp - $3.9 Million

Campaign Finance Law

• Federal Election Campaign Act 1971 • McCain-Feingold • Federal Election Commission
– http://www.fec.gov/law/feca/feca.shtml

Citizens United v. Federal Election Commission - 2009
• McCain-Feingold prohibition on independent expenditures by corporations and unions violated the First Amendment • Paved way for “Super PACs,” that make no $s contributions to candidates, but can do unlimited independent expenditures • SpeechNow – US Appeals Court, DC Circuit 2010. Lifted limits on amount of contributions, allowing unlimited funds from individuals, corporations and unions.

Top Super PACs
• “Restore Our Future” (Romney) $82.5 mln • “Priorities USA Action” (Obama) $24.8 mln • “American Crossroads” (Rove) $19 mln
• 829 groups organized as Super PACS
– raised $349 million and spent $233 million

Sept. 5

NYT – Emanuel to Raise Money for Democratic `Super PAC’
– “I find all the special-interest money lined up on the other side, tilting the scales in a way that I don’t want to see,” Mr. Emanuel said.

Sept. 6

LA Times – A convention without corporate sponsors?
By Matea Gold and Melanie Mason
– Democrats vowed to put on a peoples convention paid for with small donations. But Big-name money was persistently present in Charlotte – AT&T, Bank of America, Coca-Cola and United Health Group among those who gave $11 mln

Sept. 8

AP – Super PAC backing Obama airs anti-Romney tax ad, says middleincome households would pay more
- Priorities USA Action airs ad in Colorado, Florida, Iowa, Ohio, Virginia and Wisconsin - Romney said to have 5-2 advantage over Obama in some television markets

Sept. 10

WSJ – Obama Tops Romney in August Fundraising.
• President Barack Obama’s campaign had its best fundraising month yet in August, raising more than $114 million. With the DNC. • Romney and RNC raised $111.6 mln.

Aug. 22

Sunlight Foundation Debuts Ad Hawk App for iPhone and Android (press release)
– New mobile app to help voters better know who is buying political ads. Listens to the ad and then lists information about who placed it. – ‪ ttp://adhawk.sunlightfoundation.com/

 h

Resources
The Sunlight Foundation
– Sunlight Labs creating new online and mobile tools – Influence Explorer www.influenceexplorer.com – A web bookmarking tool from Sunlight Labs, the tech arm of Sunlight Foundation. www.poligraft.com – Listings of fundraising events. www.PoliticalPartyTime.org – www.sunlightfoundation.com

Resources
Federal Election Commission
– Disclosure portal has searchable catalog of official candidate and political action committee filings. National parties and independent expenditures. Downloadable data files. – www.fec.gov

Resources
Center for Responsive Politics
– Top all time donors – Search by industry or company name – Helpful staff. Custom data. – www.opensecrets.org

Resources
Political MoneyLine
– Searchable database – Custom research – Kent Cooper and Tony Raymond. – www.fecinfo.com

Resources
National Institute on Money in State Politics.
– Tracks donations in all 50 states – www.followthemoney.org

Editors Want to Know
• What’s the best story we can tell right now? • Answer: Analysis and exclusives
– Follow the money (data) – Paper trail (online) – Sources (people)

Digging into Companies
• • • • 10-K annual report 10-Q quarterly report 8-K material event report Proxy statement. CEO pay and board of directors

Lobbying Disclosures
• House Clerk’s Office • Lobbying Disclosure Act of 1995 • Lobbyists required to report new clients, fees, and legislation of interest • http://lobbyingdisclosure.house.gov

April 22
New York Magazine - “Sugar Daddies. The Old, Rich White Men Who Are Buying This Election.” By Frank Rich.
– If you want to appreciate what Barack Obama is up against in 2012, forget about the front man who is his nominal opponent and look instead at the Republican billionaires buying the ammunition for the battles ahead. A representative example is Harold Simmons, an 80year-old Texan who dumped some $15 million into the campaign before primary season had ended.

http://nymag.com/news/frank-rich/conservative-donors-2012-4/

Aug. 15
WSJ - Zynga Puts Real Money Into Gambling Lobby. By John Letzing
– The lobbying investments by Zynga in Washington, D.C., and California come as the company eyes real-money gambling versions of games as a key opportunity amid waning investor confidence and a battered stock price. – online.wsj.com

Corporate Governance and Transparency: Covering Companies from Washington
Bill Roberts 202 329 7157 wroberts3@mac.com

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