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Full-Text Articles in Law

Corporate Power Is Corporate Purpose Ii: An Encouragement For Future Consideration From Professors Johnson And Millon, Leo E. Strine Jr. Oct 2016

Corporate Power Is Corporate Purpose Ii: An Encouragement For Future Consideration From Professors Johnson And Millon, Leo E. Strine Jr.

Faculty Scholarship at Penn Law

This paper is the second in a series considering the argument that corporate laws that give only rights to stockholders somehow implicitly empower directors to regard other constituencies as equal ends in governance. This piece was written as part of a symposium honoring the outstanding work of Professors Lyman Johnson and David Millon, and it seeks to encourage Professors Johnson and Millon, as proponents of the view that corporations have no duty to make stockholder welfare the end of corporate law, to focus on the reality that corporate power translates into corporate purpose.

Drawing on examples of controlled companies that ...


What Went Wrong: Prudent Management Of Endowment Funds And Imprudent Endowment Investing Policies, James J. Fishman Jan 2014

What Went Wrong: Prudent Management Of Endowment Funds And Imprudent Endowment Investing Policies, James J. Fishman

Pace Law Faculty Publications

Most colleges and universities of all sizes have an endowment, a fund that provides a stream of income and maintains the corpus of the fund in perpetuity. Organizations with large endowments, such as colleges, universities, and private foundations, all finance a significant part of their operations through the return received from the investment of this capital. This article examines the legal framework for endowment investing, endowment investing policies, their evolution to more sophisticated and riskier strategies, and the consequences evinced during the financial crisis of 2008 and beyond. It traces the approaches to endowment investing and chronicles the rise and ...


Corporate Culture And Erm, Michelle M. Harner Jul 2013

Corporate Culture And Erm, Michelle M. Harner

Faculty Scholarship

The attitudes and actions of those viewed as leaders within a company (commonly referred to as “tone at the top”) help to define corporate culture and are critical to implementing a successful enterprise risk management (ERM) program. This paper explores the challenges and benefits of creating a risk-aware corporate culture, including the potential legal implications for boards of directors.


To Be Or Not To Be Both Ceo And Board Chair, Thuy-Nga T. Vo Jan 2010

To Be Or Not To Be Both Ceo And Board Chair, Thuy-Nga T. Vo

Faculty Scholarship

Part I of this article discusses the management and monitoring responsibilities of the board of directors. Part II explores the duality governance structure and its prevalence in corporate America. In Part III, the article examines and weighs the theoretical arguments for and against duality. Based on these arguments, this part assesses the impact of combined or separate CEO and Chair positions on the board’s performance of its management and monitoring responsibilities. Part IV turns to the empirical data on the effect of combined, rather than separate, CEO-Chair roles on corporate performance. Part V explains the views of corporate stakeholders ...


The Story Of Hewlett-Packard, Barbara Black Jan 2009

The Story Of Hewlett-Packard, Barbara Black

Faculty Articles and Other Publications

With the development of the modern corporation, corporate boards have been the locus of corporate authority, and particularly since the 1980s, boards and their performance have been under intense scrutiny. Nevertheless, corporate law has not developed a consistent theory for what boards are supposed to do; instead, it sends mixed messages about the functions and expectations of boards and the appropriate people to sit on them. The HP saga illustrates some of the dilemmas faced by directors confronted by these competing pressures.


Unconscious Bias And The Limits Of Director Independence, Antony Page Jan 2009

Unconscious Bias And The Limits Of Director Independence, Antony Page

Faculty Publications

Corporate directors make difficult decisions: How much should we pay our CEO? Should we permit a lawsuit against a fellow director? Should we sell the company? Directors are legally obligated to decide in good faith based on the business merits of the issue rather than extraneous considerations and influences. Naturally, some directors may have preferences, or even biases: Our CEO, my colleague and friend, deserves a lot; The company should not sue my fellow board member; We should not sell, because after all, I would like to remain a board member. But the courts presume that independent directors either do ...


An Overview Of Brazilian Corporate Governance, Bernard S. Black, Antonio Gledson De Carvalho, Érica Gorga Jul 2008

An Overview Of Brazilian Corporate Governance, Bernard S. Black, Antonio Gledson De Carvalho, Érica Gorga

Cornell Law Faculty Publications

We provide the first detailed picture of firm-level corporate governance practices in an emerging market. We report on the corporate governance practices of Brazilian public companies, based primarily on an extensive 2005 survey of 116 companies. Most firms have a controlling shareholder or group. Board independence is an area of weakness. The boards of most Brazilian private firms are comprised entirely or almost entirely of insiders or representatives of the controlling family or group. Many firms have no independent directors. Financial disclosure is a second area of weakness. Only a minority of firms provide a statement of cash flows or ...


The Fetishization Of Independence, Usha Rodrigues Jan 2008

The Fetishization Of Independence, Usha Rodrigues

Scholarly Works

According to conventional wisdom, a supermajority independent board of directors is the ideal corporate governance structure. Debate nevertheless continues: empirical evidence suggests that independent boards do not improve firm performance. Independence proponents respond that past studies reflect a flawed definition of independence.

Remarkably, neither side in the independence debate has looked to Delaware, the preeminent state source for corporate law. Comparing Delaware's notions of independence with those of Sarbanes-Oxley and its attendant reforms reveals two fundamentally different conceptions of independence. Sarbanes-Oxley equates independence with outsider status. An independent director is one who lacks financial ties to the corporation and ...


The Duty To Creditors Reconsidered - Filling A Much Needed Gap In Corporation Law, Richard A. Booth Jan 2007

The Duty To Creditors Reconsidered - Filling A Much Needed Gap In Corporation Law, Richard A. Booth

Faculty Scholarship

The most fundamental question of corporation law is to whom does the board of directors of a corporation owe its fiduciary duty. Recently, the question has tended to be whether and under what circumstances the board of directors has the duty to maximize stockholder wealth. But if a corporation is insolvent (or close to it), business decisions designed to maximize stockholder wealth may result in a reduction of creditor wealth. Although the conventional wisdom is that creditors must protect themselves by contractual means, there is a substantial body of case law that says that creditors can assert claims sounding in ...


Slides: Community Forest Project: Grand Lake Stream, Maine, Steve Keith Jun 2005

Slides: Community Forest Project: Grand Lake Stream, Maine, Steve Keith

Community-Owned Forests: Possibilities, Experiences, and Lessons Learned (June 16-19)

Presenter: Steve Keith, Farm Cove Community Forest, Downeast, ME

62 slides


Larger Board Size And Decreasing Firm Value In Small Firms, Theodore Eisenberg, Stefan Sundgren, Martin T. Wells Apr 1998

Larger Board Size And Decreasing Firm Value In Small Firms, Theodore Eisenberg, Stefan Sundgren, Martin T. Wells

Cornell Law Faculty Publications

Several studies hypothesize a relation between board size and financial performance. Empirical tests of the relation exist in only a few studies of large U.S. firms. We find a significant negative correlation between board size and profitability in a sample of small and midsize Finnish firms. Finding a board-size effect for a new and different class of firms affects the range of explanations for the board-size effect.


Authority Of The President Over Corporate Litigation: A Study In Inherent Agency, The , Roger J. Goebel Jan 1962

Authority Of The President Over Corporate Litigation: A Study In Inherent Agency, The , Roger J. Goebel

Faculty Scholarship

It is a traditional rule of corporate law that the board of directors exercises plenary power over corporate management. In fact, however, the twentieth century has witnessed a decided shift of the functional center of authority to the corporate officers. Although a basic residuum of authority remains in the board of directors, the officers, especially the president, in the majority of corporations exercise the day-to-day control of corporate affairs; In practice the modern corporation is occasionally directed by a general manager, but more often by the president (or perhaps, to use a mode currently in vogue for large public- issue ...