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Tag: stakeholder

The Inevitability and Desirability of the Corporate Discretion to Advance Stakeholder Interests

Einer Elhauge, Petrie Professor of Law, Harvard Law School

In The Illusory Promise of Stakeholder Governance, Lucian Bebchuk and Roberto Tallarita offer a vigorous defense of the view that corporate leaders should have a legal duty to maximize only shareholder value.11. Lucian A. Bebchuk & Roberto Tallarita, The Illusory Promise of Stakeholder Governance, 106 CORNELL L. REV. 91 (2020). They define “corporate leaders” as…

Feb 2022

Shareholderism Versus Stakeholderism–A Misconceived Contradiction

Colin Mayer, Peter Moores Professor of Management Studies, Saïd Business School, University of Oxford

This Essay critiques an assessment by Lucian Bebchuk and Roberto Tallarita of the relative merits of shareholder and stakeholder governance. In “The Illusory Promise of Stakeholder Governance,” Bebchuk and Tallarita argue that stakeholder governance is either nothing more than enlightened shareholder value, or it imposes unmanageable trade-offs on directors of companies. But trade-offs are ubiquitous…

Feb 2022

On the Promise of Stakeholder Governance: A Response to Bebchuk and Tallarita

William Savitt, Partner, Wachtell, Lipton, Rosen & Katz

Aneil Kovvali, Harry A. Bigelow Teaching Fellow & Lecturer in Law, University of Chicago Law School

Professor Bebchuk and his coauthor Roberto Tallarita have launched a broadside against recent efforts of business leaders, scholars, and lawyers to promote a corporate governance model that permits directors to take into account interests other than stockholders—a governance regime that authorizes directors to manage their corporations having in mind the interests not of stockholders alone,…

Feb 2022