Corporate Interests and Think Tanks – An Overview of Current Debates

How and why do corporations fund think tanks? How do think tanks manage potential conflicts of interest? How transparent and traceable is corporate funding to think tanks?

In order to answer these questions, Transparify has located, compiled and reviewed dozens of media stories and research papers. Today, we release the results of our work, an annotated bibliography on “Corporate Interests and Think Tanks”. This is the fourth and last in our series of think tank bibliographies.

Most authors suggest that many corporations fund think tanks out of strategic self-interest. For example,financial industry players in both the US and the UK are thought to systematically support think tanks that produce work that furthers their sponsors’ agendas within a context characterized by intensive lobbying efforts across multiple fronts.

Corporations’ possible influence on energy policy and climate change debates via their funding of think tanks has drawn particular attention. For example, one author claims that “climate change denial” by think tanks has been funded via trusts that enabled their donors to remain anonymous and untraceable despite over one hundred million dollars allegedly passing through such channels. Another retorts that the renewable energy industry too has vested interests, and that it sometimes promotes and defends these interests by… you guessed it… funding policy wonks. A third observer alleges that calls for financial disclosure by think tanks engaged in climate change debates have often been one-eyed as well as one-sided. (Here at Transparify, we simply believe that all think tanks should fully disclose who funds them, regardless of the policy stances that they take.)

Possible conflicts of interest also lurk when think tanks weigh in on questions of war and peace. In a recent guest blog on our website, Gin Armstrong explored such possible conflicts of interest that may have been at play when think tank experts with defence industry ties took to the airwaves in 2013 to discuss US military strikes against Syria. In recent days, she has voiced similar concerns with regard to policy advice being proffered on the ongoing crisis in Ukraine. Mind you, in an industry dependent on public sector contracts that is notorious for its revolving doors, even public funding for think tanks has not been immune against suspicions of self-interested dealings.

Does the tobacco industry really employ think tanks as mercenaries to fight on its behalf? Do car manufacturers really pay think tanks to talk governments into bailing them out with public funds? Indeed, can any think tank still accept funding from any source without immediately coming under suspicion of having been “bought” by some public or private vested interest?

We at Transparify don’t have the answers. For us, this little media review yields one conclusion: the think tank community may soon face a comprehensive crisis of credibility. If current trends continue, even the most sophisticated and methodologically scrupulous policy research outfits will find it hard to get their findings, ideas and policy recommendations taken at face value.

In an environment increasingly characterized by finger pointing, suspicion and paranoia, think tanks committed to intellectual independence and excellence in research need a way to actively signal to policy makers and the media that they deserve their trust and respect.

Transparify’s aim is to provide think tanks with a tool for signalling their credibility: a policy research institution publicly recognized for its exemplary financial transparency can hardly be accused of harbouring “hidden” agendas.

(For your reference, the bibliography discussed above is accessible here.)

Voluntary Disclosure Can Restore Trust in Think Tanks

Guest blogger Patrick Gilroy warns that think tanks are in danger of losing their credibility. Transparify does not edit the content of guest blogs; the views expressed in this blog are those of the author alone, and may not reflect the views of Transparify.

The ‘think tank’ label still evokes notions of independence and the scholarly pursuit of knowledge, and journalists frequently cite think tanks as independent experts without simultaneously disclosing who funds them (a recent online petition laments the practices of the BBC in this regard). Yet in Washington D.C., one can observe a veritable politicization of think tanks, as avowedly ideological institutes now outnumber the more centrist or scholarly ones. With mandatory contributor disclosure not in sight, think tanks with clearly ideological purposes can still grant hidden sponsors full tax deductibility of donations under tax code section 501(c)(3).

For example, in the US it became publicly known in 2010 to what extent the billionaire Koch Brothers fund conservative think tanks. In Europe too, anecdotes of secret corporate funding of institutes staging a sort of counter-expertise are accumulating. For instance, the oil and gas firm Exxon Mobil funded London- and Brussels-based think tanks to deny climate change and depict EU policies as being based on “junk science”. Think tank networks like the Stockholm Network seem to essentially cater to interested business clients. Such stories add to a profound uncertainty about think tanks’ credibility.

Non- or under-reporting of financial details has led to widespread cynicism. Media pundits worry that “secretive think tanks are crushing our democracy”, lumping together all think tanks in the process. But not (fully) disclosing financial details does not necessarily imply malicious intent. Most balanced think tanks may just shy away from the reporting burden, or do not recognize that beyond being a democratic principle, transparency boosts their primary asset: namely, the perception of key audiences that they are intellectually independent and trustworthy. Voluntary disclosure therefore is the single best tool we have for creating a level playing field.

Because think tanks ultimately depend on this to survive and thrive they should lead by example. Annually disclosing details on who exactly funds their work is not just a sign of professionalism. It must become a strategic priority for think tank leaders worldwide to make such information available on their websites, and within initiatives such as the European Commission and European Parliament’s joint Transparency Register (where over 300 think tanks have registered so far, thereby endorsing its code of conduct). Of course, voluntary disclosure is no perfect remedy, as it is vulnerable to gaming (selective disclosure) or donor capture (anticipatory obedience) in practice.

With think tanks’ rising influence come higher expectations for responsibility. As with Odysseus binding himself to his ship’s mast, think tanks only stand to gain from transparency. Voluntary disclosure is a small step for a think tank, but one giant leap for the credibility of the craft.

Patrick Gilroy is a PhD candidate at the Hertie School of Governance within the Berlin Graduate School for Transnational Studies (BTS). In his empirical research project, situated at the nexus of international relations and organizational sociology, he researches EU-focused think tanks’ influence in European and global governance.