Political connections and the SEC confidential treatment process

Research output: Contribution to journalArticlepeer-review


SEC confidential treatment (CT) orders are regulatory exemptions that enable firms to redact proprietary information from SEC filings if the disclosure would cause competitive harm and if the information is immaterial to investors. This study examines the role of firms' political connections in the SEC's decisions to approve versus reject CT requests before and after Congressional intervention and internal SEC scrutiny into the CT process. CT requests from politically connected firms are less likely to be rejected before Congressional intervention and internal SEC scrutiny and are more likely to be rejected following these events. When the SEC rejects CT requests, firms must disclose the contents of the unapproved redactions. These disclosures are informative to investors, on average, and are less informative following Congressional intervention and internal SEC scrutiny. Together, these findings contribute to the literature on political influence in SEC oversight and disclosure regulation and provide unique evidence on the role of Congressional intervention in SEC decision making.

Original languageEnglish (US)
Article number101511
JournalJournal of Accounting and Economics
Issue number1
StatePublished - Aug 2022


  • Congressional intervention
  • Disclosure regulation
  • Political incentives
  • SEC confidential Treatment

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics

Cite this