For decades, European policymakers have aspired to create a single capital market capable of financing innovation on a scale comparable to that of the United States. Yet, as reiterated by the recent Letta and Draghi Reports, that ambition remains …

Corporate insiders’ opportunistic trading – particularly selling their firms’ stocks before bad news – erodes public trust, reduces market participation, and exacerbates the agency problem that occurs when the interests of insiders and the company conflict. Yet, regulators have been …

Policymakers and academics have extensively debated the extent and the nature of the revolving door phenomenon – the movement of workers between the government and the private sector. Proponents claim that the flow of former regulators to commercial firms fosters …

Banks and other corporations have been exploring green financing as a way to implement ESG business projects. Green loans and sustainability-linked loans (“SLLs”) are the major types of such financing. The former require the use of borrowed proceeds for green …

Democratic institutions depend on public confidence to function effectively. Citizens comply with tax laws when they trust the IRS, cooperate with police when they view law enforcement as legitimate, and engage constructively with regulators they perceive as fair and effective. …

A central challenge to the effectiveness of shareholder voting is the collective action problem, where dispersed individual shareholders lack sufficient incentives to use their voting rights effectively. The problem is prevalent among retail investors, whose small ownership stakes and minimal …

On October 15, the Delaware Supreme Court heard arguments in In re Tesla, Inc. Derivative Litigation, more commonly known as Richard J. Tornetta v. Elon Musk, et al. and Tesla, Inc., the stockholder derivative action rescinding Elon Musk’s …

Oceans of ink have been spilled analyzing the corporate world’s criticism of Delaware case outcomes in recent years and the Delaware legislative response in February 2025. In the wake of all that ink came discussions of whether corporate CEOs, boards, …

The U.S. Supreme Court’s Citizens United v. FEC decision, along with the SpeechNow.org v. FEC court decision, reshaped the landscape of political contributions. By striking down limits on independent expenditures, these rulings opened the door to a new, opaque channel …

Sovereign wealth funds (SWFs) are now central to how nations stabilize fiscal balances, diversify assets, and project financial influence. Norway’s oil fund, Singapore’s Temasek, and the Gulf states’ investment vehicles all serve as stabilizers and strategic tools in global markets. …

Over the past decade, the meaning of shareholder democracy has shifted dramatically. Investors are no longer a uniform bloc, focused solely on financial returns, but increasingly diverse. Some press companies to pursue environmental and social goals, while others adhere to …

On September 2, 2025, U.S. Representative Zachary Nunn sent a letter to the chair of the Committee on Foreign Investment in the United States (CFIUS) highlighting concerns over ownership transparency of certain bitcoin mining firms and suppliers connected to China. …

The backlash against environmental, social, and governance (“ESG”) investing has been swift and fierce. More than 20 U.S. states have passed laws or taken administrative action targeting ESG considerations in asset management. Flows into ESG funds have slowed, and for …

Companies around the world are under pressure to diversify their executive leadership, while facing skepticism about their efforts. In a new study, we examine women’s entry into and exit from the highest levels of corporate leadership.

Breaking in Sooner

Research …

The convergence of emerging financial technologies and traditional diplomatic relations has created novel challenges for legal frameworks governing digital asset regulation and conflicts of interest in government. Recent developments involving the Trump administration, United Arab Emirates (UAE) investment entities, and …

Going public represents a milestone in corporate evolution, opening doors to capital markets and enabling expansion. Yet what if this achievement comes with hidden costs for the people who work at these companies? Our recent analysis of millions of Glassdoor …

A corporate governance revolution is underway. The conventional depiction of the U.S. capital markets has focused on the presence of large institutional shareholders and their substantial influence over the economy. But in the past two years, in response to political …

The tech sector has a great talent for using words whose superficial meaning is reinforced through intense though misleading marketing but whose actual meaning turns out to be quite different. Consider the name “stablecoin,” a simple term given to a …

Disclosure requirements can serve legitimate public purposes, but a blanket mandate risks negative economic ramifications. In a new paper, I examine how excessive mandatory disclosure could backfire, what makes an appropriate rule, and the l challenges of  evaluating policies on …

There is a robust debate among policymakers on whether to impose restrictions on the incentive pay of bankers. Proponents of such restrictions point to the great financial crisis and argue that enormous compensation packages give top executives and traders at …

For over a century, Delaware’s dominance in corporate law has been credited to an expert judiciary, deep case law, a specialized bar, a responsive legislature, and relative insulation from interest-group politics. Recent legislative and jurisprudential events, however, have caused observers …

Global capital markets are undergoing profound transformation. Over the past decade, there has been a marked decline in Initial Public Offerings (IPOs) in most advanced economies, including those with highly developed capital markets such as the United Kingdom and the …

The gap between CEO and worker pay in the U.S. has become a chasm. According to the Economic Policy Institute, the CEO-to-worker compensation ratio skyrocketed from 21-to-1 in 1965 to a staggering 344-to-1 in 2022.^[1] This widening disparity has …

On September 15, 2025, Elon Musk filed a disclosure with the U.S. Securities and Exchange Commission (SEC) indicating that he had acquired approximately 2.57 million shares of Tesla Inc. in open-market transactions on September 12, at a cost of nearly …

“Too big to fail” became a household phrase during the 2007–08 Global Financial Crisis. When giant financial institutions teetered, the government reached for ad hoc bailouts, fearing contagion and a broader economic collapse. Congress responded with the Dodd-Frank Act, which …

The debate over corporate purpose – whether companies should serve shareholders exclusively or balance the interests of a broader set of stakeholders – has become one of the defining issues in corporate governance. With climate change and sustainability shaping regulatory …

Elon Musk is once again testing the boundaries of the law on fiduciary duties. In September 2025, Tesla proposed to give him a new compensation package valued at more than $1 trillion, the largest in corporate history. Shareholders are scheduled …

The Corporate Sustainability Due Diligence Directive (CSDDD) represents one of the European Union’s most ambitious attempts to hold businesses accountable for their global impact. The directive establishes a corporate due diligence duty with core elements focused on identifying and addressing …

Activist investors and blockholders are unable to restructure and turnaround poorly performing banks, making it unlikely that they can enhance bank performance and contribute to financial stability. We argue that regulation and supervision hinder the flow of information needed to …

Advocates of blockchain technology promised that it would revolutionize governance through strong commitments, transparency, and “trustlessness” – the absence of any need to trust a bank or other intermediary.  In a recent paper, I argue that these promises have largely …

In May 2024, a company in California suddenly made headlines across the financial press. Synapse Financial Technologies, once hailed as a pioneer in the next wave of financial innovation, filed for bankruptcy. The company had promised to revolutionize banking …

The successful takeover bid by Monte dei Paschi di Siena (MPS) for Mediobanca is a landmark event in Italian corporate history. While offering lessons for corporate governance in Delaware and the U.S. generally, it sheds new light on an old …

The enactment of the GENIUS Act of 2025 marks a watershed moment in American cryptocurrency regulation, establishing the first comprehensive federal framework for payment stablecoins.[1] Yet within this law lies a provision that may fundamentally reshape the balance between …

Sidney Weinberg and his son John Weinberg both served as longstanding chairmen of Goldman Sachs.  Recently, John’s 1948 Princeton undergraduate thesis came to light. Like a 1933 memorandum and a 1949 speech by Sidney, it addressed a fundamental issue: What …

In a new article, I argue that, under current Delaware law, there is a collision between the definition of pre-suit demand and shareholder voice. To demonstrate, imagine that a sophisticated institutional shareholder of a Delaware public corporation has determined that …

Corporate transparency is often assumed to be driven by law, regulation, and public scrutiny. Yet new research shows that private pressure – quiet, anonymous inquiries sent through companies’ grievance channels – can meaningfully shape how firms disclose sensitive information.

In …

To detect corporate misconduct, regulators frequently rely on firms’ employees, who are often privy to private information and the first to identify wrongdoing. To encourage employees and others to share what they know, many regulators have implemented whistleblower programs. Some …

As technology’s importance to companies grows, so does the need for what we call “digital governance:” leveraging technology within governance structures and managing the risks it presents. In a recent paper, we examine how China and India are addressing …

Derivatives lawyers are not known to be an excitable bunch.  But a recent opinion from the U.S. District Court in the Northern District of Texas has derivatives lawyers excited, and not in a good way.  The judge has vastly restricted …

Telecommuting technologies have enabled widespread remote work, but it has also blurred the line between work and personal life. Constant connectivity has fostered an “always-on” culture, raising concerns that employees are increasingly vulnerable to overwork, burnout, and declining mental health. …

Critiques of both ESG and anti-ESG shareholder proposals[1] provide a valuable opportunity to clarify what matters in modern corporate governance: active shareholder participation, empirical evidence, and a holistic understanding of risk. While Michael Levin and others rightly highlight the …

Proxy advisers play a pivotal role in corporate governance by providing institutional investors with recommendations on how to vote at shareholder meetings. These firms influence key corporate decisions, including the election of directors, executive compensation, and governance policies, thereby exerting …

Despite decades of research on M&A outcomes, a puzzling question persists: Why do acquiring firms receive, on average, almost no cumulative abnormal returns around deal announcements (i.e., Betton, Eckbo, and Thorburn, 2008; Moeller, Schlingemann, and Stulz, 2004)? Numerous studies have …

There is a venerable history of interdependence between sovereign debt and the financial system.  The national banking system in the U.S. arose as a solution to fiscal challenges the Union government faced in the Civil War.  A key requirement for …

In an era of heightened political uncertainty – from gridlock in Washington to changes within the European Union – political risk has become a top concern for many boards of directors. Firms often cultivate political connections to mitigate these risks …

The rise of work-from-home following the COVID-19 pandemic sparked vigorous debate about its impact on productivity. While other studies have focused on routine tasks like call center operations or data entry, our recent study examines a high-skilled group: equity analysts, …

The underrepresentation of women in the top executive ranks of U.S. corporations is well-documented. Less understood is what happens after women reach the C-suite: Do they keep these jobs as long as men?

Our research examines this question in depth, …

Corporate culture matters. A flawed culture can lead to disaster even when a company boasts an elaborate compliance program. Yet scholars and practitioners still know surprisingly little about what legal mechanisms can generate accountability for corporate culture gone wrong.

In …

Proxy advisers exercise immense influence through their voting recommendations to shareholders. Corporations, aware of the importance of those recommendations, expend valuable resources to ensure that the recommendations align with management’s preferences by hiring governance consultants to influence outcomes. These consultants …

On June 9, 2025, Department of Justice (“DOJ”) issued “Guidelines for Investigations and Enforcement of the Foreign Corrupt Practices Act (FCPA),” as contemplated by President Trump’s February 10, 2025 executive order, which, among other things, paused enforcement of …

While climate change poses clear threats to corporate financial health, from disrupted supply chains to higher insurance costs, our new research shows that climate risks don’t always lead to lower credit ratings. In fact, we find, firms that increase transparency …

The growing gap between CEO compensation and typical worker pay has become one of the most visible signs of rising economic inequality. In the United States, this gap has widened dramatically over the past several decades. While CEOs in the …

Following a string of high-profile data breaches and other cybersecurity failures, investors and regulators increasingly expect corporate directors to monitor cyber risk. But what does board oversight of cybersecurity look like in practice, and is it effective? In a recent …

Over the past two decades, investor demand for firms’ non-financial information, particularly Environmental, Social, and Governance (ESG) data, has surged. This has led to the emergence of numerous ESG rating agencies, which assimilate and transform complex, non-financial disclosures into more …

In July 2025, the U.S. House of Representatives passed the Anti-CBDC Surveillance State Act (H.R. 1919), legislation prohibiting the Federal Reserve from issuing a central bank digital currency (CBDC) directly to the public.¹ Days later, President Trump signed the Guiding …

While shareholder proposals on governance are perennial favorites that win majority support from shareholders, advisory proposals that continue to receive significant support from a bloc of investors highlight areas in which enhanced corporate disclosure could be material to a significant …

Delaware occupies a central place in American corporate governance. Its corporate code, judiciary, and bar are widely respected for their expertise and responsiveness. Over the years, Delaware has earned a reputation as the jurisdiction of choice for public companies and …

In response to fears that companies would reincorporate in states like Texas or Nevada, the Delaware legislature recently enacted a controversial bill (SB-21) that makes the state’s law friendlier to persons controlling corporations. Many writers have commented on the Delaware …

Corporate law requires the directors of ordinary, for-profit corporations to manage firms in the best interests of shareholders, forbidding directors from sacrificing corporate profits in service of other goals. There has been longstanding debate, even amid proponents of this rule, …

In a new paper, I examine the potential of sunset clauses – legal provisions that automatically phase out enhanced voting rights over time or upon certain events – to mitigate the imbalances and entrenchment risks associated with tenure-based voting structures, …

In December 2022, the SEC finalized a major overhaul of Rule 10b5-1, which governs pre-scheduled insider trading plans. The amendment to the rule introduced several procedural safeguards designed to curb what critics saw as widespread abuse of the rule. While …

A fundamental question in corporate finance is how the flow of information affects the cost of raising capital. Investors tend to reward transparency because it helps them evaluate a firm’s risks and prospects, and they often accept lower returns when …

In the modern private capital markets, the traditional distinctions between equity and debt have become increasingly blurred and inadequate to capture the complexity of modern investment instruments. Sophisticated market participants – particularly private credit funds – have begun to craft …

Few in business or law are talking enough about the national legalization of sports gambling.  For the last few months, anyone, in any state, has been able to place wagers on the outcome of professional baseball, basketball, hockey, and tennis …

The recent federal court ruling in Bartz v. Anthropic PBC has significantly shifted the legal terrain for corporate governance and artificial intelligence. While the case directly addresses copyright issues, it has implications boards of directors, compliance departments, and AI policy.…

Ever since economist George Akerlof offered his “market for lemons” insight, many studies have examined the role of asymmetric information in the market for sale and purchase of corporate assets.[1] They have typically focused on buyer-side information asymmetry about …

In a recent paper, we offer fresh insights into how climate-related communication can materially influence corporate finance. We find that firms whose earnings calls contain positive climate change sentiments (effectively communicating firms’ contribution to protecting the environment) tend to have …

After nearly two decades of regulatory uncertainty, digital assets stand at a critical juncture in American financial law. On July 18, 2025, President Trump signed the “Guiding and Establishing National Innovation for US Stablecoins Act,” known as the GENIUS Act, …

In a recent article, professors Jill Fisch and Jeff Schwartz argue that the beneficiary primacy model – requiring pension fund trustees to maximize economic value solely for beneficiaries – fundamentally misunderstands the nature of public pension funds. They contend …

In a new paper, we explore the relationship between co-opted directors and firms’ anti-takeover provision (ATPs). We argue that the relationship can be viewed through traditional agency theory, which highlights the potential conflict of interests between firm managers and owners. …

In recent years, the failure of high-profile startups has drawn renewed attention to a persistent question in the venture capital (VC) world: How much diligence is enough when speed of investment is at a premium? Collapses at the likes of …

A subtle, yet potentially dangerous shift is underway in one of the most influential narrative sections of financial reports: the Management’s Discussion and Analysis (MD&A). Companies are increasingly crafting these disclosures not just for human shareholders or regulators, but for …

Most industry and academic discussion about the Fed focuses, as is appropriate, on the Federal Reserve Board of Governors’ role in managing monetary policy and, in particular, its tools for managing interest rates and inflation in the shadow of tariffs …

Decades of marijuana prohibition in the U.S. have proven costly, consuming billions in enforcement dollars and burdening the criminal justice system with millions of marijuana-related arrests. However, as societal attitudes toward marijuana have shifted and the benefits of legalization have …

Board structure sits at the heart of corporate governance, but its optimal form remains a subject of debate. A longstanding view – championed by Jensen (1993) and Yermack (1996) – advocates for smaller boards, arguing they are more efficient and …

Climate change has become a central topic of discussion among banking regulators and policymakers. While many policymakers focus primarily on addressing the environmental externalities associated with carbon emissions, banking regulators confront a unique set of challenges that the current regulatory …

On July 1, Paramount Global settled the lawsuit brought by President Trump claiming personal harm from alleged “election interference” in the editing of an interview with Kamala Harris by CBS News’ 60 minutes.  The agreement called for the company to …

The corporate law discourse on climate change has largely focused on the “internal dimension” of directors’ duties – whether boards must consider climate-related risks and opportunities that affect firm-specific financial performance. While this question has gained significant traction, a more …

When a team of researchers asked an artificial intelligence system to design a railway network that minimized the risk of train collisions, the AI delivered a surprising solution: Halt all trains entirely. No motion, no crashes. A perfect safety record, …

Shareholders and investor advocacy groups have long criticized executives for being paid top dollar while achieving subpar returns for shareholders. In response, the Securities and Exchange Commission (SEC) passed the Dodd-Frank Act of 2010, which has two, related provisions that …

The relationship between corporate compliance and reputation has fundamentally changed in our digitally interconnected world. What once were discrete regulatory violations now cascade across multiple stakeholders, with ramifications amplified by social media and enabled by new forms of stakeholder coordination. …

The Organization for Economic Co-operation and Development (OECD) Principles of Corporate Governance (the Principles) are widely regarded as the global benchmark for corporate control and accountability. The Principles are soft law and hence not legally …

The fiduciary duties of institutional investors have become a hot issue for policymakers and courts, with the future financial security of millions of American workers and savers at stake. Unfortunately, many recent policy debates and court opinions on such duties …

On June 12, 2025, an Air India plane crash killed 241 people en route to London.[1] The accident made international news and prompted an international investigation.[2] Understanding the cause of the crash was essential to prevent future accidents: …

The promise of decentralized finance (DeFi) was that it would replace often conflict-ridden financial intermediaries and hierarchies with automated systems that we could trust. The reality, however, is that DeFi has not eradicated conflicts or trust issues but shifted them …

The U.S. investment crowdfunding market is quietly facing a crisis.

A troubling number of startups have raised capital from everyday investors under Regulation Crowdfunding (Reg CF)—and then disappeared, ghosting the crowd by failing to file the annual reports required by …

As AI systems evolve, there’s been a surge of attention and anxiety around how they are reshaping the workforce. The conversation often centers on which jobs are at risk of automation and what machines are capable of. While these are …

Large language models (LLMs) are rapidly becoming integral to financial analysis, from parsing earnings calls to predicting stock market reactions to news. But a critical question remains: When we feed these models more information, do they perform better? Our recent …

Growing concerns about the externalities that companies may impose on stakeholders have placed the mainstream shareholder primacy model under intense scrutiny. Stakeholderism, or stakeholder model, is an alternative approach that requires companies to consider interests beyond those of shareholders, is …

In a recent article, we explore the curious case of how regulators in the EU, UK, and United States treat two forms of insider trading — what we call “traditional insider trading” and “shadow trading.” The former, familiar to …

In recent years, public firms in the U.S. have increasingly issued revenue guidance that is not based on Generally Accepted Accounting Principles (GAAP). Instead, they have focused on customized, non-GAAP metrics such as “organic revenue” or “constant-currency revenue.” Non-GAAP revenue …

Tariffs have been front-page news for the last few months, virtually since the moment that the Trump Administration came into office. Along with this news has come considerable commentary on the impact the tariffs may have on the U.S. and …

Earlier this year, Judge Reed O’Connor made headlines when he rejected a plea agreement between the Department of Justice (“DOJ”) and Boeing. O’Connor rejected the agreement because it required the DOJ to consider its DEI policies in selecting a corporate …

For nearly 40 years, regardless of whether confidential information belonged to a governmental entity or a private-sector business, its misappropriation could be prosecuted as a property crime. Lower federal courts relied on Carpenter v. United States,[1] a well-known …

In the debate over whether corporations should give priority to shareholder interests or stakeholder interests, among the thorniest issues is whether one approach creates more value for a company than the other. The challenge lies in the difficulty of assessing …

Stablecoins have emerged as a central pillar of the digital asset ecosystem, offering a bridge between traditional fiat currencies and decentralized finance. The GENIUS Act, a stablecoin regulation proposal, is advancing with bipartisan support through the U.S. Senate.^[1] Given …

Diversity, equity, and inclusion efforts remain one of the most prominent topics of discussion within corporate leadership. Unfortunately, the views and actions connected to these efforts continues to waver. After the murder of George Floyd and the rise of the …

The under-pricing of initial public offerings (IPOs) has puzzled researchers for decades. First-day returns average around 15 percent, translating into billions of dollars left on the table by issuers and picked up by investors allocated shares in the IPO.  The …

Artificial intelligence (AI) tools, particularly large language models, are quickly becoming integral to financial advising. Recent evidence, however, demonstrates that they can act against investors’ interests. In a 2023 experiment,researchers deployed GPT‑4 as an autonomous trading agent and found that …

In recent years, legal scholars and economists have debated whether the rise of “common ownership” by large institutional investors dampens competition. The concern is that when asset managers such as the Big Three – BlackRock, Vanguard, and State Street – …

In August 2024, Delaware enacted what are widely considered the most significant and controversial amendments to the state’s corporate statute in at least a generation. Principally, those amendments exalt freedom of contract over what was, in the words of the …

The startup ecosystem fuels America’s economy in ways few other sectors can match. It has also ridden waves of boom and bust, with periods of explosive growth followed by cool-downs. During these market downturns, capital becomes scarce and investors must …

In a prior post, I explored whether Texas could challenge Delaware’s century-long dominance in corporate law. The Texas Legislature has since provided a compelling answer. On May 14, 2025, Governor Greg Abbott signed Senate Bill 29 (SB 29), a …

Controlled companies – public firms where an individual, group, or another company holds majority voting power – make up a significant and growing share of the U.S. public market, accounting for over $2.2 trillion in 2019 alone. Despite their scale, …

The U.S. Federal Reserve is 12 banks, not one. Each serves a different region of the country and brings insights from that region into the process of formulating nationwide monetary policy. Each also provides a variety of banking services to …

Margins serve as a critical mechanism for mitigating default risk in centrally cleared derivatives. Brokerage firms, acting as intermediaries, may impose supplemental margins on investors beyond those required by clearinghouses. A January 2025 policy report from global financial regulators recommended …

Venture capital contracting is the function of a complex private-ordering exercise through which venture capitalists and entrepreneurs address the challenges of financing high-tech firms (Kaplan & Strömberg, 2004). Throughout decades of iterative practice, U.S. venture capital contracts have …

In the world of legislative decision-making, one truth holds: U.S. legislators are heavily motivated by re-election. To win votes, they must understand and serve the economic interests of their constituents. This dynamic raises an intriguing question: How do members of …

In the world of startups, founders are often elevated to near mythical status – the force poised to disrupt entire industries. This adulation can grant founders extraordinary latitude in corporate control, especially in innovative and unregulated sectors like tech or …

In a new essay, I compare a judicial revolution that is happening with one that is not. Both the change and the status quo are being managed by the current Supreme Court. , When it comes to administrative law, the …

In a new article,  I examine the history of the Walt Disney Company as a case study of what I perceive to be a gap in the law of fiduciary duties of corporate directors and executives.  Based on publicly available …

In a recent paper, we examine how the EU Corporate Sustainability Due Diligence Directive (CS3D) could reshape the behavior of American corporations. The CS3D holds large corporations legally accountable for how they protect human rights and the environment throughout …

After the Delaware Court of Chancery invalidated Elon Musk’s $56 billion compensation package, Tesla made headlines by moving its incorporation from Delaware—the longtime gold standard for incorporation—to Texas. Following Tesla’s reincorporation, Texas moved to strengthen its newly created business court. …

In April 2025, the landscape of U.S. crypto regulation shifted significantly. Three of the country’s principal bank regulators – the Federal Reserve, the Office of the Comptroller of the Currency (OCC), and the Federal Deposit Insurance Corporation (FDIC) – jointly …

Pay-for-performance is often championed as a possible solution to agency problems, aligning managers’ incentives with shareholder interests. But what happens when solving one agency problem creates another – between the firm and society?

In a recent paper, we develop a …

Corporations play an increasingly active role in lobbying, with a growing focus on influencing government rulemaking. According to the Center for Responsive Politics, corporate lobbying expenditures at the federal level reached a record $3.7 billion in 2024, accounting for 86.3 …

Lawyers for public companies across the world may not have expected this, but a recent UK appellate decision on an Antigua and Barbuda company greatly enhanced global shareholder rights.  The reason is straightforward – Antigua is one of a handful …

Whose interests do public pension funds serve? On the one hand, they have a fiduciary duty to maximize value for the pension fund participants whose retirement savings they invest. On the other, they can use their considerable ownership stakes to …

I argue in a forthcoming article[1] that when corporate misconduct results in someone’s death, resolving the ensuing criminal charges with a “C” plea bargain can be antithetical to the pursuit of justice. To support my argument, I examine one …

Congress seems on its way to passing the first piece of federal crypto-regulation, the Guiding and Establishing National Innovation for U.S. Stablecoins – or GENIUS – Act. The law would create a comprehensive regulatory framework for payment stablecoins, which are …

Issues of labor mobility gained significant attention last year following U.S. bans on non-compete agreements. While the debate on non-competes has many dimensions, this post focuses on how to address firm governance, improve labor welfare, and reduce the loss to …

Delaware courts reserve their entire fairness standard of review – the state’s “most onerous standard” – for, among others, cases involving conflicted controllers.[1] In recent years, there is a view that the standard’s application (or at least the procedural …

Activist investors often think that the classification of boards abets sloth, protecting directors from shareholder input. Yet boards understandably value the durability and continuity of multi-year terms, which give them the bargaining power to pursue long-term plans. Companies often try …

Out-of-court corporate restructurings, or “corporate workouts,” involve high-stakes multi-party negotiations without a clear procedural framework, such as the one that Chapter 11 provides. This gives the parties the freedom to design workouts without the constraints imposed by a rigid legal …

Shifting U.S. enforcement priorities may soon create a crisis in international anti-corruption efforts. For decades, the United States spearheaded those efforts through prosecutions under the Foreign Corrupt Practices Act (FCPA). On February 10, however, President Donald Trump issued an Executive …

The dominant shareholder primacy model of corporate governance makes shareholder wealth maximization both the purpose of a corporation and the only legitimate consideration for decisions by corporate directors.  Yet that single-stakeholder model is under attack on several fronts.  Numerous scholars …

On March 26, 2025, Delaware Governor Meyer signed into law Senate Bill 21 (“SB21”) updating Delaware’s corporate law. While there has been considerable discussion of whether the bill was beneficial or detrimental to shareholders, we show that there is no …

Shareholder activism has undergone a striking transformation over the past four decades. What began in the 1980s as a brash and often combative movement led by so-called corporate raiders has matured into a sophisticated, globally attuned, and strategically agile phenomenon. …

Founders and early investors increasingly maintain control of companies while holding small economic stakes in them – raising fundamental questions about how Delaware courts can enforce  accountability in corporate governance. In a new working paper, I challenge the courts’ …

Over recent decades, the massive globalization of finance has led many observers to expect widespread harmonization of nations’ financial regulations. Yet, while there has been a remarkable degree of harmonization in some areas, at least at the regional level, considerable …

Chapter 11 was widely seen as a failure in the first decade of the Bankruptcy Code’s operation, the 1980s. Large firms were mired in bankruptcy for years; the process was seen as expensive, inaccurate, and subject to abuse. While basic …

The Federal Deposit Insurance Corporation (FDIC) is the U.S. agency responsible for insuring all bank deposits and facilitating all bank resolutions. Yet, as only one of three bank regulators, the agency relies on the Federal Reserve (Fed) and Office of …

Firms often face a free-rider problem when competitors learn about and implement the firms’ innovations without bearing the costs of development, a phenomenon known as knowledge spillovers. As recent empirical evidence shows, this causes substantial underinvestment in research and development …

Policymakers around the world have typically outsourced the detection of financial crime to the private sector. This approach is often referred to as the “gatekeeper” model, with the basic idea being that private firms, like bodyguards at a nightclub, are …

Given their importance to corporate governance and often impressive credentials and experience, , many directors are “busy,” meaning they hold concurrent board appointments across multiple firms. These so-called “interlocks” between companies are a growing phenomenon, but not a new one. …

For years, activist investors and corporate governance advocates have fought to eliminate classified boards at public companies. Classified (or staggered) boards, which only allow a portion of directors to be replaced at each annual meeting, are sometimes seen as a …

Venture capital (VC) is a key driver of economic growth. A substantial body of legal and financial scholarship has examined the institutional factors that shape VC activity. In the first of two papers, we build on the idea that the …

On March 11, 2008, Congress held its first ever hearing on corporate monitors. The hearing began with questions to John Ashcroft, the former U.S. Attorney General who then headed a law and consulting firm, about why he had been given …

In a recent study, we examine how political ideology affected SEC commissioners’ stances on whether to adopt the International Financial Reporting Standards (IFRS). Our findings reveal a partisan divide that stalled decision-making and left the U.S. as an outlier in …

In a new article, we focus on the Securities and Exchange Commission’s enforcement of the CEO and CFO certification requirement pursuant to the Sarbanes-Oxley Act (SOX). The article analyzes the appropriate interpretation of the statute’s reach, the SEC enforcement proceedings …

Most financing agreements define “Events of Default” as being triggered not only by serious defaults, such as a borrower’s failure to repay its debt, but also by relatively minor or technical “secondary” defaults not involving debt repayment. Typical examples of …

In the debate over introducing ideas from environmental and sustainability regulation to corporate law, one major issue has been largely missing: discounting frameworks. Discounting is important for evaluating the future benefits of investment today and is used by both social …

For over two decades, policymakers worldwide have worked to combat profit shifting and tax avoidance, leading to the widespread adoption of anti-tax avoidance regulations. Notable examples include the European Union’s Anti-Tax Avoidance Directive and the Tax Cuts and Jobs Act …

The venture capital (VC) industry has expanded greatly over the past several decades as innovative startups have become a key driver of economic growth and innovation in the United States. Foundational scholarly accounts of startup governance focused on the VC-entrepreneur …

In late November 2024, the Bank of England published the results of its first system-wide exploratory scenario (SWES) exercise – a year-long effort to model how various financial entities, including non-bank financial intermediaries (NBFIs) and banks, would respond to a …

At a recent Columbia Law School colloquium, participants posed a foundational question: How do corporate law standards of fiduciary duty relate to what scientists call the “climate emergency”?[1]

Unfortunately, under what I will call the Maximization Model of fiduciary …

In a recent article, I analyze the function of shareholder ratification in corporate governance and argue that understanding this function is critical to both refining shareholder-based cleansing mechanisms and appreciating their inherent limitations. Although I focus on Corwin cleansing in …

Fear that more companies might follow Tesla and reincorporate outside Delaware has been roiling the corporate world, driven by recent court decisions that impose relatively stringent controls on controlling shareholders. In response, Delaware’s legislature is considering Senate Bill 21 (SB …

One of the primary challenges faced by the courts after a firm files for bankruptcy is estimating the continuation value of the reorganized firm. Often there are large errors in these estimates, which raise significant concerns about the efficiency of …

My colleague Eric Talley at Columbia Law School has proposed an ingenious modification of SB 21 – scheduled for a vote today in the Delaware legislature – that highlights the contractarian traditions of Delaware law and builds off the experience …

Where do entities incorporate? The question is of perennial interest to academics who wish to research and teach the laws that govern many companies. It is of particular interest now, given a string of controversial court decisions and legislative responses…

As I write this from the Tulane Corporate Law Institute’s annual conference in New Orleans, the energy is palpable. While Mardi Gras revelers have vacated the streets, they’ve been replaced by a different phalanx of uncharacteristically confrontational carousers: corporate law …

On February 20, Delaware Supreme Court Chief Justice Collins Seitz met with members of the state’s General Assembly and delivered some sobering words: “Along with our respect for your legislative judgments, I ask you to consider the importance of judicial …

Delaware lawmakers recently rushed out proposed changes to the state’s time-tested corporate law, claiming that the risk that companies will leave Delaware demands an “urgen[t]” vote this month. We know now that the bill, S.B. 21, was written …

In a new article, we challenge one of corporate law’s most persistent narratives: the concept of “shareholder democracy.” With people on opposing sides of recent high-profile battles at companies like Disney, Tesla, and Exxon invoking “shareholder democracy” to support their …

In our new paper, we offer a resolution to a longstanding puzzle in contract theory: Why do practitioners in several categories of high-stakes corporate transactions (such as M&A and financings) routinely fix price terms early, while leaving non-price terms …