Abstract

http://ssrn.com/abstract=1447404
 
 

Citations (1)



 


 



Transparency and Accountability: Rethinking Corporate Fiduciary Law's Relevance to Disclosure


Faith Stevelman


New York Law School

August 11, 2009

Georgia Law Review, Vol. 34, No. 505, 2000
NYLS Legal Studies Research Paper No. 09/10 #7

Abstract:     
This article explores the duty of “disclosure/complete candor” (among directors, from boards to shareholders and from controllers to minority shareholders) within state corporate fiduciary law (especially Delaware’s, the most developed). It observes the odd minimization of the candor/disclosure duty within the core doctrines of fiduciary care, loyalty and good faith. It analyzes the evolution of the fiduciary disclosure duty and its “moment of truth” in the watershed litigation in Malone v. Brincat. The belated appearance of the fiduciary disclosure duty is partly the result of historical, customary and political understandings which have dwarfed logic and conceptual coherence in this area of law. The customary dividing line between “corporate” law and governance and what’s deemed “federal securities law” and “market regulation,” has been grossly overstated and was untenable, as demonstrated by Congress’ subsequent enactment of the Sarbanes-Oxley Act and corporate law’s humbled stature in (minimally) responding to the massive financial frauds of ’01-’02. A central claim is that the fiduciary disclosure/candor duty is the core principle within fiduciary law: it addresses the informational/power asymmetry that is the root of agency cost problems, inter alia. Too often technical problems relating to the quantification of remedies has derailed corporate law’s force in this area. But adjudicated fiduciary wrongs without remedies are far from trivial: they undermine the legitimacy and vitality of corporate law, even Delaware’s. Recent doctrinal expansion in the duty of disclosure supports this claim, as does the ongoing trend to a ‘knowledge’ based economy. Insights about corporate law pedagogy are also blended into the discussion.

Number of Pages in PDF File: 17

Keywords: disclosure candor, Delaware, fiduciary, agency cost, care, loyalty, good faith, federalism

Accepted Paper Series


Download This Paper

Date posted: August 11, 2009  

Suggested Citation

Stevelman, Faith, Transparency and Accountability: Rethinking Corporate Fiduciary Law's Relevance to Disclosure (August 11, 2009). Georgia Law Review, Vol. 34, No. 505, 2000; NYLS Legal Studies Research Paper No. 09/10 #7. Available at SSRN: http://ssrn.com/abstract=1447404

Contact Information

Faith Stevelman (Contact Author)
New York Law School ( email )
185 West Broadway
New York, NY 10013
United States
212-431-2197 (Phone)
212-431-1830 (Fax)
HOME PAGE: http://www.nyls.edu/pages/374.asp
Feedback to SSRN


Paper statistics
Abstract Views: 569
Downloads: 112
Download Rank: 139,635
Citations:  1
Paper comments
No comments have been made on this paper

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo5 in 0.641 seconds