Regulating Corporate Governance in the Public Interest: The Case of Systemic Risk

Proceedings of the Keynote Address, National Business Law Scholars Conference (NBLSC), The University of Chicago Law School June 23, 2016

Duke Law School Public Law & Legal Theory Series No. 2016-42

17 Pages Posted: 8 Jul 2016 Last revised: 3 Sep 2016

Date Written: June 23, 2016

Abstract

There’s long been a debate whether corporate governance law should require some duty to the public. The accepted wisdom is not to require such a duty — that corporate profit maximization provides jobs and other public benefits that exceed any harm. This is especially true, the argument goes, because imposing specific regulatory requirements and making certain actions illegal or tortious can mitigate the harm without unduly impairing corporate wealth production. Whether that is true in other contexts, this paper — delivered as the keynote address at the June 2016 National Business Law Scholars Conference at The University of Chicago Law School — questions if it’s true in the context of systemic economic harm. The paper argues that corporate governance law should require some duty to the public in order to help mitigate that harm. Even if imperfect, such a duty represents an important step towards shaping corporate governance norms to begin to take the public into account.

Suggested Citation

Schwarcz, Steven L., Regulating Corporate Governance in the Public Interest: The Case of Systemic Risk (June 23, 2016). Proceedings of the Keynote Address, National Business Law Scholars Conference (NBLSC), The University of Chicago Law School June 23, 2016; Duke Law School Public Law & Legal Theory Series No. 2016-42. Available at SSRN: https://ssrn.com/abstract=2805668

Steven L. Schwarcz (Contact Author)

Duke University School of Law ( email )

210 Science Drive
Box 90362
Durham, NC 27708
United States
919-613-7060 (Phone)
919-613-7231 (Fax)

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