Corporations and Shareholder Political Transparency Activism in the United States

Abstract

Scholars from sociology, political science, management, and economics have long debated the causes and consequences of business in politics. The controversy of corporate money in politics was amplified by the Supreme Court’s landmark 2010 Citizens United decision on electioneering communications. Policymakers, the public, and activists are worried that this might open the corporate campaign spending floodgates, and corporate America may abuse its political power over democracy. Many concerned primary and secondary stakeholders have tried to advocate for corporate political transparency and accountability. This dissertation examines the antecedents and consequences of primary shareholder activists that seek to improve corporate political transparency in the United States from 2000-2018. Using big data and web-scraping techniques, this dissertation offers several large-scale, novel datasets on U.S. public firms and addresses how shareholder activists select corporate targets, how corporate elites manage shareholder threats, and whether shareholder activists can disrupt corporate financial and political outcomes. Integrating both social movements and organizational theories, this dissertation shows that shareholder activists target corporate political activities not only because of managers not maximizing shareholder value but also due to the co-existence of corporate opportunities and threats that motivate activists promoting liberal causes. Corporate elites’ political ideology serves as a critical component that drives the emergence of shareholder political transparency activism. This dissertation also reveals that corporate elites tend to use multiple tactics such as political disclosure, board oversight, and policy reform to manage the challenges associated with potential or actual shareholder threats. This dissertation also demonstrates that shareholder activism can disrupt corporate political activities, but not financial outcomes.