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Corporate governance

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Rewarding Outside Directors, Assaf Hamdani, Reinier Kraakman Jun 2007

Rewarding Outside Directors, Assaf Hamdani, Reinier Kraakman

Michigan Law Review

While they often rely on the threat of penalties to produce deterrence, legal systems rarely use the promise of rewards. In this Article, we consider the use of rewards to motivate director vigilance. Measures to enhance director liability are commonly perceived to be too costly. We, however demonstrate that properly designed reward regimes could match the behavioral incentives offered by negligence-based liability regimes but with significantly lower costs. We further argue that the market itself cannot implement such a regime in the form of equity compensation for directors. We conclude by providing preliminary sketches of two alternative reward regimes. While …


The Role Of Financial Journalists In Corporate Governance, Michael J. Borden Jan 2007

The Role Of Financial Journalists In Corporate Governance, Michael J. Borden

Law Faculty Articles and Essays

This Article pursues the important theme of disclosure, but focuses on a feature that has remained almost entirely overlooked by corporate and securities law scholars: the role of financial journalists in corporate governance. This omission is perhaps due to the fact that journalists do not fit easily into a legal discussion because they are largely unregulated. They are, in a sense, not legal actors, and, therefore do not comfortably become the subject of a legal prescription. Nevertheless, journalists contribute in many ways to the legal system at large and the system of corporate governance in particular.This Article uses case studies …


The Rise Of Independent Directors In The United States, 1950-2005: Of Shareholder Value And Stock Market Prices, Jeffrey N. Gordon Jan 2007

The Rise Of Independent Directors In The United States, 1950-2005: Of Shareholder Value And Stock Market Prices, Jeffrey N. Gordon

Faculty Scholarship

Between 1950 and 2005, the composition of large public company boards dramatically shifted towards independent directors, from approximately 20% independents to 75% independents. The standards for independence also became increasingly rigorous over the period. The available empirical evidence provides no convincing explanation for this change. This Article explains the trend in terms of two interrelated developments in U.S. political economy: first, the shift to shareholder value as the primary corporate objective; second, the greater informativeness of stock market prices. The overriding effect is to commit the firm to a shareholder wealth maximizing strategy as best measured by stock price performance. …


The Role Of Financial Journalists In Corporate Governance, Michael J. Borden Jan 2007

The Role Of Financial Journalists In Corporate Governance, Michael J. Borden

Fordham Journal of Corporate & Financial Law

No abstract provided.


The New Global Financial Landscape: Why Egregious International Corporate Fraud Should Be Cognizable Under The Alien Tort Claims Act, Joel Slawotsky Oct 2006

The New Global Financial Landscape: Why Egregious International Corporate Fraud Should Be Cognizable Under The Alien Tort Claims Act, Joel Slawotsky

Duke Journal of Comparative & International Law

No abstract provided.


Sarbanes-Oxley's Structural Model To Encourage Corporate Whistleblowers, Richard E. Moberly Feb 2006

Sarbanes-Oxley's Structural Model To Encourage Corporate Whistleblowers, Richard E. Moberly

ExpressO

Recent corporate scandals demonstrate that rank-and-file employees often remain silent in the face of significant fraud. This silence is unfortunate because corporate employees have inside knowledge of misconduct that gives them an information advantage over more traditional corporate monitors, such as independent directors and government regulators. To address this problem, the Sarbanes-Oxley Act utilized a new approach that encourages employee whistleblowers to disclose information about corporate wrongdoing. This approach, which Professor Richard Moberly labels the “Structural Model,” requires that corporations provide a standardized channel for employees to report organizational misconduct to official monitors within the corporation. This Article offers an …


Capitalism And Freedom — For Whom?: Feminist Legal Theory And Progressive Corporate Law, Kellye Y. Testy Oct 2004

Capitalism And Freedom — For Whom?: Feminist Legal Theory And Progressive Corporate Law, Kellye Y. Testy

Law and Contemporary Problems

Progressive corporate law has the potential to realign corporate activity and market economies with human benefit. The present state of disruption in the economy is a key moment: with disruption comes the opportunity for change.


Corporate Law Or The Law Of Business?: Stakeholders And Corporate Governance At The End Of History, Adam Winkler Oct 2004

Corporate Law Or The Law Of Business?: Stakeholders And Corporate Governance At The End Of History, Adam Winkler

Law and Contemporary Problems

Surely, corporate managers themselves, who must operate within the broader law of business, are aware of the legally imposed duties to protect workders, consumers, and larger communities. Perhaps it is time corporate lawyers caught up to this reality.


The Change Of Corporate Governance Structure In The United States And Taiwan, Yifan Tseng Aug 2004

The Change Of Corporate Governance Structure In The United States And Taiwan, Yifan Tseng

LLM Theses and Essays

This thesis is discussed corporate governance issues in different legal schemes, mainly about the latest legal reforms in the United States, and Taiwan. And it is also talked about what kinds of impacts of the latest legal reforms of corporate governance in the United States on the foreign private issuers listed their securities in the NYSE or Nasdaq. Different corporate governance structures are derived from different legal basis and there is no perfect corporate governance model, however, with globalization and integration of financial and capital markets, the stronger the markets are, and the more influential their corporate governance structures would …


What Caused Enron? A Capsule Social And Economic History Of The 1990s, John C. Coffee Jr. Jan 2004

What Caused Enron? A Capsule Social And Economic History Of The 1990s, John C. Coffee Jr.

Faculty Scholarship

The sudden explosion of corporate accounting scandals and related financial irregularities that burst over the financial markets between late 2001 and the first half of 2002 – Enron, WorldCom, Tyco, Adelphia and others – raises an obvious question: Why now? What explains the concentration of financial scandals at this moment in time? Much commentary has rounded up the usual suspects and placed the blame on a decline in business morality, an increase in "infectious greed," or other similarly subjective trends that cannot be reliably measured. Although none of these possibilities can be dismissed out of hand, approaches that simply reason …


Enronitis: Why Good Corporations Go Bad, Daniel J.H. Greenwood Jan 2004

Enronitis: Why Good Corporations Go Bad, Daniel J.H. Greenwood

Hofstra Law Faculty Scholarship

The Enron problem - managers becoming extraordinarily wealthy while misleading shareholders, creditors and employees about the company's prospects and even driving it into the ground - is widely understood to be the result of too weak a legal mandate supporting the share-centered paradigm of corporate law. Paradoxically, it is also the predictable result of too strong a share-centered view of the public corporation. Share-centered corporate law creates the very problems it is meant to police. The single-valued profit maximization ethos of the share-centered corporation demands that managers teach themselves to exploit everyone around them: it is inevitable that some will …


Reconsidering The Importance Of Law In Japanese Corporate Governance: Evidence From The Daiwa Bank Shareholder Derivative Case, Bruce E. Aronson Apr 2003

Reconsidering The Importance Of Law In Japanese Corporate Governance: Evidence From The Daiwa Bank Shareholder Derivative Case, Bruce E. Aronson

Cornell International Law Journal

No abstract provided.


The A.A. Sommer, Jr. Annual Lecture On Corporate Securities & Financial Law: Post-Enron America: An Sec Perspective, Harvey Goldschmid, William Treanor, John F.X. Peloso, Jill Fisch Jan 2003

The A.A. Sommer, Jr. Annual Lecture On Corporate Securities & Financial Law: Post-Enron America: An Sec Perspective, Harvey Goldschmid, William Treanor, John F.X. Peloso, Jill Fisch

Fordham Journal of Corporate & Financial Law

No abstract provided.


The Sarbanes-Oxley Yawn: Heavy Rhetoric, Light Reform (And It Might Just Work), Lawrence A. Cunningham Jan 2003

The Sarbanes-Oxley Yawn: Heavy Rhetoric, Light Reform (And It Might Just Work), Lawrence A. Cunningham

GW Law Faculty Publications & Other Works

A thorough examination of the much ballyhooed Sarbanes-Oxley Act reveals dominantly a federal codification of extant rules, regulations, practices, and norms. Despite advertising it as "the most far-reaching reforms of American business practices since the time of FDR," a soberly apolitical view sees the Act as more sweep than reform. Important are provisions calling for nine studies; redundant but much publicized were the certification requirements imposed during the summer of 2002; other moves are mere patchwork responses to precise transgressions present in the popularized scandals. The Act is far from trivial, however. A silver bullet relates to the structure and …


Ethics, Law Firms, And Legal Education, Milton C. Regan Jan 2003

Ethics, Law Firms, And Legal Education, Milton C. Regan

Georgetown Law Faculty Publications and Other Works

A rash of recent corporate scandals has once again put professional ethics in the spotlight. It's hard to pick up the Wall Street Journal each day and not read that authorities have launched a new investigation or that additional indictments are imminent. Stories of financial fraud and outright looting have galvanized the public and shaken the economy. What ethical lessons can we draw from these events? Two explanations seem especially prominent. The first is a story of individuals without an adequate moral compass. Some people's greed and ambition were unchecked by any internal ethical constraints. For such deviants, no amount …


Introduction To The Essays Of Warren Buffett: Lessons For Corporate America, Lawrence A. Cunningham Jan 1997

Introduction To The Essays Of Warren Buffett: Lessons For Corporate America, Lawrence A. Cunningham

GW Law Faculty Publications & Other Works

This Professor Cunningham's Introduction to his edited collection of Warren Buffett's noted letters to shareholders of Berkshire Hathaway Inc. The collection was prepared for a symposium held at Cardozo Law School in New York City in 1997 and originally published in the Cardozo Law Review. The Introduction serves as an encapsulation of the main themes of the resulting collection and locates them in contemporary discourse on matters of corporate governance; corporate finance and investing; mergers and acquisitions; and accounting and taxation. Professor Cunningham subsequently published the edited collection as a book under the title The Essays of Warren Buffett: Lessons …