Umm, no. Publically traded corporations do not, except for their initial public offerings and relatively unusual (at least among established companies) follow-on offerings (typically a company that is trying to expand substantially, think Silicon Valley companies with only a few years of existence), receive funds from the sale of stock.

 

And even the IPO funding isn’t really a significant source of funds for the corporate treasury, as the proceeds typically go to the initial investors, at least most of it.

 

Finally, of course, Citizens United stood for the proposition that incorporated entities (and presumably other forms of association, like unions) have a constitutionally protected right to spend money out of their general treasury, which in the case of for-profit corporations are mainly derived from the sale of goods and services. The scheme you outline would prevent this, and fall well outside of what Citizens United permits the government to do.

 

Sean Parnell

President

Center for Competitive Politics

http://www.campaignfreedom.org

http://www.twitter.com/seanparnellccp

124 S. West Street, #201

Alexandria, VA  22310

(703) 894-6800 phone

(703) 894-6813 direct

(703) 894-6811 fax

 

 

I'm teaching Citizens United for the first time and haven't thought, since the initial round of congressional testimony on the decision, about possible corporate governance measures that might be adopted in its wake.  But re-reading the majority's discussion of why corporate PACs are not constitutionally adequate, this question occurred to me:
 
What if Congress required publicly traded for-profit corporations to set up, not a PAC, but just a separate bank account for electioneering communications, and required that the funding of this account be a separate class of corporate shares--ones with equivalent ownership rights to common stock?  Decisions on how to spend these funds could be made by regular corporate means (CEO, board of directors, etc.), without requiring any specific shareholder approval (other than the basic decision to purchase this class of shares).  Most significantly, there would be no "contribution" limit on the amount of money anyone could spend to purchase this class of shares, or any kind of ceiling on the amount of funds this separate bank account could receive (either in aggregate or any particular source) or spend. 
 
Would this rule satisfy the majority's constitutional standard?  I would think quite likely, but perhaps I'm missing something. 
 
Conversely, given that Citizens United is here to stay and the dissent there will not prevail any time soon, how far would this rule go to satisfying the regulatory concerns for protecting corporate shareholders and the distinctive corruption-related risks of electioneering communications by for-profit firms? 
 
Has anything like this been proposed?  As far as I've noticed, most of the corporate governance proposals after CU concern getting a shareholder approval for use of general treasury funds, rather than any "separate bank account" idea. 
 
Thanks in advance for any thoughts on this, Ned