I have written recently about the duties of corporate decision-makers. The issue was highlighted by a statement issued last month by the Business Round Table.
This post on the Columbia Law School’s blog gives the best explanation I have seen yet of the implications of the Business Round Table’s statement. Money quote:
Delaware law certainly permits boards to consider stakeholder interests and take a long-term view on how best to maximize corporate wealth. At the same time, it is clear that shareholders are the only constituency with a claim on Delaware boards’ fiduciary duties. Any evolution of corporate behavior in light of the BRT’s Statement will have to occur within the guardrails set by that reality.
And because virtually all major U.S. corporations are organized under Delaware law, their decision makers must follow Delaware law.
Via Professor Bainbridge.
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