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Bebchuk's Case for Increasing Shareholder Power: An Opposition
Theodore N. Mirvis Wachtell, Lipton, Rosen & Katz Paul K. Rowe Wachtell, Lipton, Rosen & Katz William Savitt Wachtell, Lipton, Rosen & Katz May 2007 Harvard Law and Economics Discussion Paper No. 586 Abstract: This paper sets out the view that Lucian Bebchuk's "case for increasing shareholder power" is exceedingly weak. It demonstrates that Bebchuk's proposed overthrow of core Delaware corporate law principles risks extraordinarily costly disruption without any assurance of corresponding benefit; that Bechuk's case is unsupported by any persuasive empirical data; that Bebchuk's premise that corporate boards cannot be trusted to respect their fiduciary duty finds no resonance in the observed experience of boardroom practitioners (perhaps not surprisingly, as the proposal comes from the height of the ivory tower); and that its obsession with shareholder power is particularly suspect (if not downright dangerous) in light of the palpable practical problems of any shareholder-centric approach.
Keywords: Corporate governance, shareholders, boards, directors JEL Classifications: D70, G30, G32, G34, G38, K2 Working Paper SeriesDate posted: June 03, 2007 ; Last revised: November 04, 2008Suggested CitationContact Information
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