What influence do corporations have over politics in Australia? It’s impossible to say for sure, particularly because companies don’t disclose very much about their political expenditure, according to the Australia Institute.
The left-wing think tank hired experts to look into corporate influence peddling, and found big Australian businesses lag behind their counterparts in the US when it comes to political expenditure transparency.
“I was surprised to see how few companies disclose their payments to trade associations,” Australia Institute democracy and accountability program director Bill Browne told Crikey.
“These lobby groups have extraordinary influence over the political debate, they’re widely featured in the media and in commentary, and yet we have a very incomplete picture of who funds them, how much they get funded, and what they spend that money on.”
A new report from the think tank, based on research by corporate governance firm ISS ESG, analysed political expenditure policies and disclosures from 75 of Australia’s largest ASX-listed companies.
It found only a third of the companies had made complete disclosures of their payments to political parties and candidates. Three-quarters of all the firms had made no disclosures at all of payments to trade associations. ISS ESG made a comparison with equivalent businesses in the US and found the Australian companies lagged far behind when it came to transparency.
“We’ve seen the outsized influence that vested interests have had on our political debate, when governments have tried to be ambitious and pursue public policy goals, whether it’s in the gambling space, or fossil fuels, or taxation,” Browne said.
“We’ve seen the ability of corporations to push back very effectively, and sometimes that means that we get a worse outcome. So it’s important for a democracy that everyone has an equal voice and equal influence, and when corporations cannot just influence the political debate, but do so behind the scenes and without consequences, that has a distorting effect on our democracy as a whole.”
So how could the researchers reach those conclusions, if the data is so lacking?
“Australia has some requirements for donors to disclose some forms of political payments — the threshold federally is very high, it’s about $15,000 [in the previous financial year] before a donation has to be disclosed,” Browne explained.
“So we only get hints as to what exactly is going on. But those hints are enough to provide some information.
“Another way that we learn about some of the expenditure and planned expenditure of corporations is through reporting in the press – so around the campaign against the mining tax for example, we know how much the trade associations were supposedly planning to spend, because that was reported in the media.
“We’re building this picture out of partial disclosures, a mix of voluntary and compulsory disclosures, and other reporting.”
The disclosure threshold for federal political donations was raised by the Howard government in 2006, from $1500 to $10,000. Since then the threshold has increased according to the consumer price index – donations made in the current financial year must only be disclosed if they exceed $16,300.
Browne said he believed the threshold for disclosing political donations should be lowered, and that companies should do more to be transparent about their political operations.
“One of the elements of this report is prompting shareholders to play a more active role in scrutinising the companies that they invest in, asking more of them, [which would act as] a spur to companies to disclose more,” he said.
The report, titled “The hidden political expenditure of Australian corporations”, will be released today.
