(Bloomberg) — Two former chairmen of the U.S. Securities and Exchange Commission urged the regulator to force companies to disclose campaign donations, pressuring the agency to weigh in on a politically explosive issue ahead of the 2016 presidential election.
In a bipartisan letter to SEC Chair Mary Jo White on Wednesday, Arthur Levitt and William Donaldson said corporate political spending is of “paramount public interest and growing concern to investors.” They pointed to a record 1.2 million comment letters supporting a 2011 petition by a group of securities law professors as evidence that the agency should act.
“The Commission’s inaction is inexplicable,” Levitt and Donaldson said in the letter, which was also signed by former SEC commissioner Bevis Longstreth. “It flies in the face of the primary mission of the commission, which has since 1934 been the protection of investors.”
Debate over corporate political spending flared after the U.S. Supreme Court ruled in 2010 that companies and unions could spend unlimited money on election ads. Corporations also aren’t required to report contributions they make to third parties that fund ads, including industry groups such as the U.S. Chamber of Commerce.
In the letter, the former officials said the Supreme Court’s decision was based on the expectation that companies would disclose political spending, a requirement that would fall on the SEC to enforce.
The four-year debate has been heating up recently. Last month, some advocates of the regulation funded a series of cartoon-style ads at Washington subway stations that urge White to seize on the issue. Monsters representing big business are depicted pummeling the Capitol and White House with money. White is portrayed in a cape and tights as the lone superhero who can stop unlimited campaign donations.
The issue puts White between many Republicans and trade groups who oppose a new rule and Democratic senators, including Elizabeth Warren and Sherrod Brown, who support it. The issue has also divided the five-member commission along partisan lines. SEC spokeswoman Gina Talamona said the agency hasn’t yet received the letter but will review it.