INFO - PACS

If a company or trade association tries to disclaim responsibility for which candidates receive donations from its PAC, that would be misleading.  

Here are the facts:

1.  A PAC is a political committee in the United States "organized for the purpose of raising and spending money to elect and defeat candidates" [“What Is a PAC?” OpenSecrets].  Each company PAC and trade association PAC decides to which candidates it will donate.

2.  “A PAC is somewhat different from other entities associated with a corporation. It is a separate entity, but still managed by, and part of, the corporation....Establishing the PAC: ...First, a corporation’s Board should approve the creation of the PAC...As part of this step, the corporation should select PAC officers and adopt bylaws for the PAC’s administration.” [“Forming a Corporate Political Action Committee," Venable LLP law firm.]

3.  In the case of a foreign-headquartered company, the firm’s U.S. subsidiary selects the PAC’s members/board, who are usually senior executives of the subsidiary; often the subsidiary’s lobbyists and/or government affairs staff also serve on the PAC. The PAC members/board decide which candidates the company PAC will donate to. 

4.  By law, a company cannot donate to its PAC from the company's central funds. Most of the larger donations to the PAC tend to be made by the subsidiary’s executives and their families; donations can also be made by other employees and their families, and by shareholders.  Donations by the PAC are made only to candidates selected/approved by the company-appointed members/board of the PAC.

5.  The U.S. subsidiary may pay all of the PAC’s administrative and solicitation costs. “For example, a corporation may pay all legal fees for the PAC, postage for mailings, staff time to compose solicitations, credit card processing fees, and virtually any other cost associated with the PAC.” [“Forming a Corporate Political Action Committee," Venable LLP law firm.]

6.  Some companies reportedly pressure and/or induce their employees to contribute to their PACs. [Michelle Conlin and Lucas Iberico Lozada, Reuters, “The new U.S. office politics: funding your boss's political causes,” May 11, 2015.]

See also:

• “Why corporate PACs have an advantage," Karl Evers-Hillstrom, OpenSecrets, 14 February 2020.

• "Political action committee," Wikipedia.

• “Corporate PAC FAQs," End Citizens United.

• “Corporations Should Reconsider the Value of Their Political Action Committees," Douglas Chia of Soundboard Governance, Harvard Law School Forum on Corporate Governance, 8 February 2021.

• "CORPORATE PACS SAVE FACE BY CLAIMING WORKER POWER: The groups often lobby against pro-worker interests — but that doesn’t stop them from rebranding as 'employee PACs'," Rachel M. Cohen, The Intercept, 23 March 2022.