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Full-Text Articles in Law
Asset Managers As Regulators, Dorothy S. Lund
Asset Managers As Regulators, Dorothy S. Lund
Faculty Scholarship
The conventional view of regulation is that it exists to constrain corporate activity that harms the public. But amid perceptions of government failure, many now call on corporations to tackle social problems themselves. And in this moment of dissatisfaction with government, powerful asset managers have stepped in to serve as regulators of last resort, adopting rules that bind corporate America on issues of great social importance, including climate change and workplace diversity. This Article describes this dynamic — where shareholders have become regulators — which has been made possible by the rise of institutional shareholding (and index investing in particular) …
Shifting Influences On Corporate Governance: Capital Market Completeness And Policy Channeling, Ronald J. Gilson, Curtis J. Milhaupt
Shifting Influences On Corporate Governance: Capital Market Completeness And Policy Channeling, Ronald J. Gilson, Curtis J. Milhaupt
Faculty Scholarship
Corporate governance scholarship is typically portrayed as driven by single factor models, for example, shareholder value maximization, director primacy or team production. These governance models are Copernican; one factor is or should be the center of the corporate governance solar system. In this essay, we argue that, as with binary stars, the shape of the governance system is at any time the result of the interaction of two central influences, which we refer to as capital market completeness and policy channeling. In contrast to single factor models, which reflect a stable normative statement of what should drive corporate governance, in …