The Impossibility of Corporate Political Ideology: Upholding SEC Climate Disclosures Against Compelled Commercial Speech Challenges

Erin Murphy | April 14, 2024

To address the increasingly dire climate crisis, the SEC will require public companies to reveal their business’s environmental impact to the market through climate disclosures. Businesses and states challenged the required disclosures as compelled, politically motivated speech that risks putting First Amendment doctrine into further jeopardy. In the past five years, the U.S. Supreme Court has demonstrated an increased propensity to hear compelled speech cases and rule in favor of litigants claiming First Amendment protection from disclosing information that they disagree with or believe to be a politically charged topic. Dissenting liberal Justices have decried these practices as “weaponizing the First Amendment” to evade government regulation.

The threshold question—whether certain types of speech such as securities regulations implicate the First Amendment—is rarely addressed by the Court and has never been affirmatively decided. Historically, commercial speech (expression by a corporation about an economic transaction) receives lower levels of protection relative to political or individual speech. The Court has held that compelled commercial disclosures of a factual and uncontroversial nature required only rational basis review. The Court, however, has never ruled on protections for corporations when the compelled speech is potentially of a political, rather than purely factual, nature and has continually avoided this question with narrow holdings and carved out exceptions. A First Amendment challenge to climate disclosures would force them to confront it directly.

If the challenges to the SEC climate disclosures reach the Court, it will need to consider its precedents in both commercial and compelled speech cases and incorporate the most applicable First Amendment theory. This Note argues that the compelled speech doctrine is the appropriate First Amendment analysis in deciding whether a corporation can be forced to speak and add more speech to the marketplace. By relying upon compelled speech doctrine and addressing the unnatural fit between speaker rights and corporate law, this Note ultimately concludes that corporations do not have personal First Amendment rights, and, as a result, climate regulations should only be subject to rational basis review.