Corporate Political Transparency

Posted: 11 Oct 2016

See all articles by Murad Mithani

Murad Mithani

Stevens Institute of Technology - School of Business

Date Written: September 1, 2015

Abstract

Corporations are facing a growing demand for the transparency of political contributions. In the US, this demand has largely focused on the implementation of a mandatory disclosure law. It rests on the assumption that legal enforcement can make it easier to observe the ties between corporations and political parties. In this study, we challenge this assumption. We build our case by first developing a conceptual foundation of Corporate Political Transparency (CPT). We argue that in the absence of economic benefits, legal enforcement has a limited effect on CPT. Instead of encouraging transparency, mandatory disclosure can lead to the concealment of corporate political contributions. To develop a model of concealment, we borrow the characterizations of disguise from theatrical drama. Using the context of Indian firms, we show the limitation of mandatory disclosure and the efficacy of regulatory incentive. Our study highlights the need for a broader debate on CPT in order to understand the relative implications of regulatory policies.

Keywords: Corporate political transparency, corporate political contribution, corporate political activity, campaign contribution

Suggested Citation

Mithani, Murad, Corporate Political Transparency (September 1, 2015). Available at SSRN: https://ssrn.com/abstract=2849073

Murad Mithani (Contact Author)

Stevens Institute of Technology - School of Business ( email )

Hoboken, NJ 07030
United States

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