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Business Strategists And Election Commissioners: How The Meaning Of Loyalty Varies With The Board’S Distinct Fiduciary Roles, Ethan G. Stone
Business Strategists And Election Commissioners: How The Meaning Of Loyalty Varies With The Board’S Distinct Fiduciary Roles, Ethan G. Stone
Ethan G. Stone
For twenty years, Delaware courts have been developing special standards to review board decisions that interfere with hostile bids for control or the exercise of the shareholder franchise. These “Unocal” and “Blasius” doctrines seem to fit uneasily with theories of the board’s role in corporate governance, constraining board discretion too little for shareholder primacy theories and too much for board autonomy theories. Nor have the Delaware courts succeeded in fitting Unocal and Blasius comfortably with their treatment of board decisions in other contexts. In this article, I propose that these special doctrines reflect the difference between two separate functions of …
Must We Teach Abstinence? Pensions' Relationship Investments And The Lessons Of Fiduciary Duty, Ethan G. Stone
Must We Teach Abstinence? Pensions' Relationship Investments And The Lessons Of Fiduciary Duty, Ethan G. Stone
Ethan G. Stone
Commentators have speculated that pension funds do not act as activist investors because of the constraints of fiduciary duties under ERISA. This note examines the case law under ERISA and the common law of trusts on which it is based and concludes that there are no legal constraints. The institutional incentives of the people who manage pension funds seem a better explanation for their inactivity (assuming that activism is, in fact, cost-justified).