Law Commons^™

The Use And Misuse Of Fiduciary Duties: Corporate Social Responsibility And The Standard Of Review, Jonathan R. Povilonis

William & Mary Business Law Review

This Article provides a crucial corrective to the “corporate social responsibility” debate, which concerns whether corporations have the obligation to protect or serve the interests of groups other than their shareholders, like employees or customers (often called “stakeholders”). Scholars on one side of the debate have repeatedly presumed that corporate directors’ fiduciary duties to shareholders play an important role in protecting shareholders from decisions that favor stakeholders at their expense. Scholars on the other side agree that fiduciary duties provide meaningful protection against unfavorable conduct but argue that directors should also owe fiduciary duties to stakeholders so they may be …

Regulatory Competition And State Capacity, Martin W. Sybblis

William & Mary Business Law Review

This Article explores an underlying tension in the regulatory competition literature regarding why some jurisdictions are more attractive to firms than others. It pays special attention to offshore financial centers (OFCs). OFCs court the business of nonresidents, offer business friendly regulatory environments, and provide for minimal, if any, taxation on their customers. On the one extreme, OFCs are theorized as merely products of legislative capture— thereby lacking any meaningful agency of their own. On the other hand, OFCs are conceptualized as well-governed jurisdictions that attract investment because of the high quality of their laws and legal institutions—indicating some ability to …

Corporate Venture Capital, Darian M. Ibrahim

Faculty Publications

This Article makes the case for corporate venture capital as a potentially game-changing entrant into entrepreneurial finance. Part II begins by retracing the ancillary players in entrepreneurial finance and their roles in the startup ecosystem. After finding each of them incapable of denting the venture capitalist’s current dominance, Part III introduces the large corporation as venture capitalist. Part III discusses the growing scale of corporate venture capital and why it may be desirable for startups, innovation, and society as a whole. Part IV looks at legal differences that may become important for corporate venture capitalists to consider, including securities, antitrust, …

Fiduciary Judgment Rules, Julian Velasco

William & Mary Law Review

Because of the strong moral rhetoric and robust equitable remedies available in fiduciary law, it is not surprising to find lawyers and legal scholars seeking to expand the reach of fiduciary law principles into new relationships and new areas of law. However, expansion often does not work very well because of the demanding and pervasive nature of fiduciary duties. Thus, jurists often turn to the business judgment rule and its policy of underenforcement of fiduciary duties as a way to fit fiduciary law principles into other areas of law. The problem with this approach is that it is based on …

Designing Dual-Class Sunsets: The Case For A Transfer-Centered Approach, Marc T. Moore

William & Mary Business Law Review

Dual-class stock (DCS) structures, and their implications for managerial accountability and corporate governance more broadly, have become prevalent concerns for corporate lawyers and policymakers. Recent academic and practitioner debates on DCS have tended to focus less on the general merits and drawbacks of DCS versus one share/one vote structures, and more on the specific common-ground concern as to whether and how such structures are subjected to contingent reversal or “sunset”. This Article compares the relative advantages and disadvantages of time-, ownership- and transfer-centered models of DCS sunset provisions. It argues in favor of the transfer-centered model on the grounds that: …

Corporate Commitment To International Law, Jay Butler

Faculty Publications

Corporations are increasingly important actors in international law. But vital questions underlying this development have long gone unanswered: How and why do corporations commit to international law?

This article constructs a general account of business interaction with international legal obligation and suggests that a gateway to demystifying this persistent puzzle lies in corporate opinio juris.

Corporate opinio juris describes a company's subscription to a rule of international law, even though the company is not technically bound by that rule. This subscription functions as a kind of pledge that, once made, has sway over the company and its peers and symbiotically …