Sky Blog
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 …
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’ …
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 …
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 …
We are living in a particularly polarized era, and corporate governance is no exception. The divisions have threatened to spill over to Delaware, the preferred jurisdiction for incorporation in the United States, with several high-profile cases calling the state’s neutrality …
The U.S. Supreme Court has stayed a recent district court order that preliminarily enjoined enforcement of the Corporate Transparency Act (CTA). While a separate district court ruling staying the effectiveness of the CTA’s beneficial ownership interest reporting rule (Reporting Rule) …
On January 13, the U.S. Court of Appeals for the Third Circuit issued an opinion requiring the SEC to provide a more complete explanation for its refusal to engage in formal notice-and-comment rulemaking regarding the application of securities laws to …
In the wake of the 2008 global financial crisis, stewardship codes emerged as a means for addressing the perceived shortcomings in the governance of public companies (Puchniak, 2024). While these codes vary across jurisdictions, they generally encourage informed voting by …
Citing the threats posed by foreign adversaries and criminal organizations, and seeking enhanced accountability for companies that provide software and cloud services to the federal government, the Biden administration released a new, sweeping Executive Order (“E.O.”) on cybersecurity, signing the …
The Antitrust Division of the Department of Justice has updated its 2019 Evaluation of Corporate Compliance Programs in Criminal Antitrust Investigations. The changes bring the guidance in line with recent changes to the DOJ Criminal Division’s compliance guidance, but also …
Blockchain technology promises a future where intermediaries, such as banks and governments, are no longer necessary to facilitate transactions or enforce rules. Instead, trust is embedded directly into the system through cryptography and consensus mechanisms. Blockchains underpin cryptocurrencies …
The California Air Resources Board is seeking public feedback as part of its implementation of California’s pending GHG emissions and climate risk disclosure laws. These laws – the Climate Corporate Data Accountability Act (SB 253) and the Climate Related Financial …
In a new article, I tackle the increasingly urgent question of how corporate governance principles must adapt in response to the transformative influence of artificial intelligence (“AI”). No longer just a tool for enhancing operational efficiency, AI now fundamentally alters …
The establishment of the Texas Business Court (“Business Court”) in September 2024 marks a watershed moment in corporate governance. As the “Dexit” phenomenon gains traction – with corporations considering an exit from Delaware as a state of incorporation – Texas …
Securities law often relies on stock exchanges and other self-regulatory organizations (SROs) to create rules that structure markets. The SEC reviews and must approve these rules if the agency finds they meet certain statutory requirements. SROs file over a thousand
In a new paper, we present a novel theory of “purposeful enterprise” to explain why nonprofit enterprises survive and thrive. We define nonprofit enterprises as nonprofits that generate revenue primarily through operations rather than donations.[1] Patagonia, Novo Nordisk, IKEA, …
One distinctive feature of the U.S. economy over recent decades has been the rise of the entrepreneur-dominated public company. This development has derived largely from the growth of private funding available through venture capital, so that initial public offerings have …