DISCLOSE Act Shows How Lobbying Hurts CSR

The DISCLOSE Act was recently quashed in the house, but should be reinvorgated as a way to incentivize CSR in the business community. CSR itself stops being CSR once corporate behavior is regulated; then it becomes compliance. But the government can still put the right incentives in place to encourage socially responsible corporate behavior, and one of a constructive, prophylactic policy would be requiring transparency about how companies deploy their earnings to affect politics. Let's be real: political decisions are deeply related to social responsibility. It's irrational for the CSR community to continue denying it.

The DISCLOSE Act (which is an acronym for "Democracy Is Strengthened by Casting Light On Spending in Elections") would have required (paraphrasing OpenCongress) that large donors disclose their political funding, and would have flatly prohibited funds from TARP recipients, foreign companies and government contractors in politics. How can anyone hate that? But Republicans did, even after winning a complete carveout for the N.R.A., one of the largest nonprofit spenders in existence.

Rep. Van Hollen, the Democrat that put forth the measure in response to the Supreme Court's egregious Citizens United ruling, should revive it. Disclosure is key to corporate social responsibility; the DISCLOSE act would have done for CSR what GRI has done for sustainability, which is create enough transparency to have a conversation and compare firms. The CSR community tries to be blind to politics, but the way corporations spend money lobbying and on elections results in massive policy outcomes that either hurt or help society.

The CSR community seeks to find solutions to social problems through business behavior. That's great; the private sector is the most effective, fastest route to solutions and innovation. But it's not perfect, and it fails, especially where the public interest runs directly in conflict to the profits. The private sector typically views regulations designed to keep the public safe as expensive roadblocks to profit. This is particularly true in the industries that pose the biggest, most expensive risks to the public: oil, nuclear, pharmaceuticals. The public constantly hears how much permitting and review processes slow these sectors down, etc. However, BP is what happens when we shortcut Democracy and genuflect to industry will. The way corporations spend money in politics IS a CSR issue.

The negative effect of lobbying on Democracy and the public interest is hard for CSR professionals to manage. Many in the CSR community prefer to see corporations as self regulating and trumpet all the good things companies do, sometimes treading into the realm of useless 'yes men'. DISCLOSE would have resolved many issues, and hopefully it can be resurrected to do so. However, the CSR community needs buck up and broaden CSR to include political transparency. Ignoring this issue for much longer will reduce the credibility of CSR, as CSR professionals praise companies that donate money to causes turn around and spend monumentally more lobbying against the very same causes.