Provided by: Yale University
This paper makes a case for rapid adoption of best practices in corporate governance of corporate lobbying activities. Best practice requires oversight and approval of significant lobbying activities, expenditures and positions by a standing board committee of independent directors. Leading companies on this issue have recognized that lobbying on public policies requires board oversight because it involves significant shareholder interests and can be intrinsic to the outcome of business strategy. Nonetheless, only a small fraction of U.S. corporations now have such a system of board oversight in place, despite the potential sensitivity of lobbying activities.