State Treasurer Janet Cowell is pushing to require Nike Inc. and other large corporations to make their political contributions more transparent, a move that has drawn skepticism.
In addition to seeking political disclosure from Nike, Cowell, a Democrat, also has joined efforts to get further disclosure of political spending by Devon Energy and Halliburton. The state’s pension funds hold substantial investments in the three companies — roughly $50 million in Nike alone.
“In light of the Supreme Court’s Citizens United decision, the treasurer believes that companies involved in political activities should disclose their political spending and board oversight policies to make sure these expenses are in the best interest of shareholders,” Julia Vail, a spokeswoman for Cowell, said in an email statement.
Citizens United is the 2010 U.S. Supreme Court’s landmark decision which held that the First Amendment prohibited the government from banning political expenditures by corporations and unions. While the case allowed corporations and unions to make political expenditures, it did not allow them to make contributions directly to candidates and political parties.
Cowell’s critics say that the treasurer should focus on boosting returns on the pension funds’ investments rather than highlighting the political activities of the companies in which the pensions’ investments reside.
A legislator who once announced a bid for state treasurer and has pushed for changes in the state’s pension and health plans questioned Cowell’s actions.
“I’m disappointed that in a time when we see major turnover in the treasurer’s office that she would not use her energy to get a higher return for the current future retirees in the state and the taxpayers,” said Rep. Dale Folwell, R-Forsyth.
“At a time when North Carolina has some of the highest unemployment rates in the country, the last thing I’d want to see is this state being associated with anything that would make businesses think that we’re on a witch hunt,” he said.
Cowell’s GOP opponent in the November general election does not understand the treasurer’s approach.
“It’s perplexing to know what here motives are,” said Republican treasurer candidate Steve Royal.
Cowell’s concept of requiring more political contribution disclosure has the support of Rep. Bill Current, R-Gaston.
“I feel very strongly that if I am a stockholder in the company, it should be disclosed how the senior officers are deciding who they’re contributing to,” Current said.
Vail, in her email, referenced the Center for Political Accountability’s Zicklin Index of Corporate Accountability and Disclosure, saying that Nike, Devon, and Halliburton were ranked in the bottom tier of corporations when it comes to political disclosure.
The Wall Street Journal’s Kimberly Strassel reports that the Center for Political Accountability has received hundreds of thousands of dollars from liberal philanthropist George Soros’ Open Society Institute.
In Strassel’s June 1 article, she writes: “In the growing liberal war against corporate free speech, its highest-grade weapon these days is ‘transparency.’ By pushing disclosure, the left can tee up companies for activist boycotts, protests and other actions designed to make political engagement as painful as possible.”
The state treasurer oversees the pension fund for teachers and state employees in North Carolina. She is using the pension fund’s investment in the companies as a means of requesting the political disclosure changes.
Vail said that the treasurer’s office wants the companies to make the disclosures for good corporate governance purposes, not to affect how the office invests the public pension fund’s money.
“The department’s position on political disclosure does not influence how it invests in publicly traded companies,” Vail said in an email. “However, we believe that political contributions may lead to conflicts of interest and corporate waste, thereby negatively impacting investors’ bottom line. We view our engagement with these companies a one of many tools to advocate for good corporate governance and create long-term value for the state’s pension fund.”
Barry Smith is an associate editor of Carolina Journal.