I was invited to participate in the NY Times Room for Debate on The Do-Gooder Corporation: Does the law allow corporations to pursue social goals over shareholder profits? I had a whopping 300 word maximum, so it's not exactly the most nuanced take on the issue.
My former UCLAW colleague Lynn Stout offered a similarly constrained version of her argument that:
There is a common belief that corporate directors have a legal duty to maximize corporate profits and “shareholder value” — even if this means skirting ethical rules, damaging the environment or harming employees. But this belief is utterly false. To quote the U.S. Supreme Court opinion in the recent Hobby Lobby case: “Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not.”
As regular readers know, I emphatically reject that view. For prior discussion in this space, see:
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Jan 20, 2015 ... [2] Although Blair and Stout tend to downplay the normative ... Blair and Stout stretch the team production model to encompass the entire firm. ...... on When does Leo Strine sleep? politicalfootball on I guess it depends on ...
www.professorbainbridge.com/.../the-case-against-blair-stouts-team- production-model.html
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May 5, 2012 ... [1] To be sure, some scholars find an inconsistency between the businessjudgment rule and the shareholder wealth maximization norm.
www.professorbainbridge.com/.../the-relationship-between-the-shareholder- wealth-maximization-norm-and-the-business-judgment-rule.html
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May 5, 2012 ... The shareholder wealth maximization norm set forth in Dodge is a standard of conduct, but the business judgment rule remains the standard of ...
www.professorbainbridge.com/.../case-law-on-the-fiduciary-duty-of-directors -to-maximize-the-wealth-of-corporate-shareholders.html
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