Abstract

http://ssrn.com/abstract=2341660
 


 



Constituency Directors and Corporate Fiduciary Duties


Martin Gelter


Fordham University School of Law; European Corporate Governance Institute (ECGI)

Geneviève Helleringer


ESSEC Business School; University of Oxford - Institute of European and Comparative Law

October 17, 2013

Forthcoming: The Philosophical Foundations of Fiduciary Law (Andrew Gold & Paul Miller eds., Oxford University Press, 2014)
Fordham Law Legal Studies Research Paper No. 2341660

Abstract:     
In this chapter, we identify a fundamental contradiction in the law of fiduciary duty of corporate directors across jurisdictions, namely the tension between the uniformity of directors’ duties and the heterogeneity of directors themselves. Directors are often formally or informally selected by specific shareholders (such as a venture capitalist or an important shareholder) or other stakeholders of the corporation (such as creditors or employees), or they are elected to represent specific types of shareholders (e.g. minority investors). In many jurisdictions, the law thus requires or facilitates the nomination of what has been called “constituency” directors. Legal rules tend nevertheless to treat directors as a homogeneous group that is expected to pursue a uniform goal. We explore this tension and suggest that it almost seems to rise to the level of hypocrisy: Why do some jurisdictions require employee representatives that are then seemingly not allowed to strongly advocate employee interests? Looking at US, UK, German and French law, our chapter explores this tension from the perspective of economic and behavioral theory.

Number of Pages in PDF File: 25

Keywords: constituency directors, codetermination, venture capital, fiduciary duties, corporate theory, theory of the firm, board of directors

JEL Classification: K22, G24

working papers series


Download This Paper

Date posted: October 19, 2013 ; Last revised: November 12, 2013

Suggested Citation

Gelter, Martin and Helleringer, Geneviève, Constituency Directors and Corporate Fiduciary Duties (October 17, 2013). Forthcoming: The Philosophical Foundations of Fiduciary Law (Andrew Gold & Paul Miller eds., Oxford University Press, 2014); Fordham Law Legal Studies Research Paper No. 2341660. Available at SSRN: http://ssrn.com/abstract=2341660 or http://dx.doi.org/10.2139/ssrn.2341660

Contact Information

Martin Gelter (Contact Author)
Fordham University School of Law ( email )
140 West 62nd Street
New York, NY 10023
United States
646-312-8752 (Phone)
HOME PAGE: http://law.fordham.edu/faculty/10929.htm
European Corporate Governance Institute (ECGI)
Brussels, B-1050
Belgium
HOME PAGE: http://www.ecgi.org/members_directory/member.php?member_id=621
Geneviève Helleringer
ESSEC Business School ( email )
Avenue Bernard Hirsch
B.P 50105
BP 105 Cergy Cedex, 95021
France
University of Oxford - Institute of European and Comparative Law ( email )
St Cross Building
St Cross Road
Oxford, OX1 3UL
United Kingdom
Feedback to SSRN


Paper statistics
Abstract Views: 659
Downloads: 167
Download Rank: 103,671

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo3 in 0.625 seconds