Corporate Social Responsibility & Concession Theory

This Essay examines three related propositions: (1) Voluntary corporate social responsibility (CSR) fails to effectively advance the agenda of a meaningful segment of CSR proponents; (2) None of the three dominant corporate governance theories—director primacy, shareholder primacy, or team production theory—support mandatory CSR as a normative matter; and, (3) Corporate personality theory, specifically concession theory, can be a meaningful source of leverage in advancing mandatory CSR in the face of opposition from the three primary corporate governance theories. In examining these propositions, this Essay makes the additional claims that Citizens United: (A) supports the proposition that corporate personality theory matters; (B) undermines one of the key supports of the shareholder wealth maximization norm; and (C) highlights the political nature of this debate. Finally, I note that the Supreme Court’s recent Hobby Lobby decision does not undermine my CSR claims, contrary to the suggestions of some commentators

Corporate Governance and the Omnipresent Specter of Political Bias

Subject to important qualifications, corporate decision-makers are dutybound to maximize shareholder value. However, there is reason to believe corporate decision-makers are allowing their political biases to corrupt their decision-making. This Essay posits two related fact patterns that should concern advocates of good corporate governance. The first occurs when decision-makers expressly disavow any duty to maximize shareholder value, such as when Apple CEO, Tim Cook, told shareholders, “When we work on making our devices accessible by the blind, I don’t consider the bloody ROI [return on investment],” or when Ed Stack, the chairman and chief executive of Dick’s Sporting Goods, decided that Dick’s should “take a stand” on gun violence by foregoing the sale of assault-style weapons, and said in connection therewith, “I don’t really care what the financial implication is.” This type of situation arguably breaches at least the duties of care and good faith without any change to current law. Importantly, breach of the duty of good faith may not be immunized by the seemingly ubiquitous contractual waivers of the duty of care. The second relevant fact pattern occurs when a decision-maker does not expressly disavow shareholder wealth maximization, but rather points to other arguably political goals as the basis for the decision, and is silent as to the impact on shareholder value. For example, when Gillette launched its advertising campaign challenging “toxic masculinity,” it publicly justified the decision not on the basis of an expectation of increasing sales, but rather on the grounds that it wanted to spark “a lot of passionate dialogue” and get people “to stop and think about what it means to be our best selves.” In order to address the corrupting influence of political bias to the extent it is manifest in this latter type of conduct, a change in the law may be required. This Essay argues that a ready blueprint for such a change already exists in the response of the Delaware judiciary to the omnipresent specter of directorial self-interest when adopting anti-takeover defenses. Specifically, cases like Unocal Corp. v. Mesa Petroleum Co. apply enhanced judicial scrutiny in such cases before granting decision-makers the benefit of the deferential business judgment rule. Finally, this Essay addresses criticisms of the proposed approach, including the view that the proposed approach would subject too many business decisions to an inefficient risk of enhanced scrutiny and that the challenged proclamations should be treated as mere puffery or are perhaps even necessary to maximize shareholder value

The Personhood Paradox: \u3ci\u3eCitizens United\u3c/i\u3e as Rejection of Corporate Personhood?

This ConLawNOW submission is an excerpt from a previously published piece. The following abstract is from that piece. UCLA Law Professor Adam Winkler has published an excellent book on the history of corporate rights. The book, We the Corporations: How American Businesses Won Their Civil Rights, “reveals the secret history of one of America’s most successful yet least-known ‘civil rights movements’—the centuries-long struggle for equal rights for corporations.” The book has been highly praised by some of the greatest minds in corporate and constitutional law, and the praise is well-deserved. However, the book is not without its controversial assertions, particularly when it comes to its characterizations of some of the key components of corporate personhood and corporate personality theory. This response essay will focus on unpacking some of these assertions, hopefully helping to ensure that advocates who rely on the book will be informed as to alternative approaches to key issues. Specifically, the propositions examined in this Essay include: (1) “corporate personhood has played only a small role in the expansion of constitutional rights to corporations,” (2) “the history of corporate rights has largely been a struggle between the disparate poles of personhood and piercing,” and (3) “in Dartmouth College …. Marshall was saying that corporations were too ethereal to be the basis for constitutional rights and that, instead, the court should focus on the corporation’s members.” While I provide reasons for questioning each of the foregoing propositions, I ultimately conclude that none of these criticisms undermine the book’s overall value. Most, if not all, of the issues I identify may be viewed as providing alternative ways of thinking about what is essentially the same perspective. However, advocates relying on Winkler’s book who have not been alerted to these criticisms risk being caught off guard in ways that will undermine their objectives. Thus, this Essay will hopefully provide a useful adjunct to Winkler’s impressive work

Immaterial Lies: Condoning Deceit in the Name of Securities Regulation

Elman Benjamin. Barry C. Keenan, Imperial China's Last Classical Academies. Social Change in the Lower Yangzi, 1864-1911, Berkeley, Institute of East Asian Studies, University of California Press, 1994. In: Études chinoises, vol. 16, n°1, Printemps 1997. pp. 167-173

Socio-Economics: Challenging Mainstream Economic Models and Policies

At a time when many people are questioning the ability of our current system to provide economic justice, the Socio-Economic perspective is particularly relevant to finding new solutions and ways forward. In this relatively short conclusion to the Akron Law Review’s publication, Law and Socio-Economics: A Symposium, I have separated the Symposium articles into three groups for review: (1) those that can be read as challenging mainstream economic models, (2) those that can be read as challenging mainstream policy conclusions, and (3) those that provide a good example of both. My reviews essentially take the form of providing a short excerpt from the relevant article that will give the reader a sense of what the piece is about and hopefully encourage those who have not yet done so to read the entire article