“Environment-selected directors”: An interactive simulation experiment of environmental representation on corporate boards

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See all articles by Bill Tomlinson

Bill Tomlinson

University of California, Irvine

M. Six Silberman

IG Metall

Andrew W. Torrance

University of Kansas - School of Law

Nick Nikols

University of California, Irvine School of Law

Rebecca Black

University of California, Irvine

Kurt Squire

University of California, Irvine - Department of Informatics

Paramdeep Singh Atwal

University of California Irvine

Ameya Mandalik

University of California Irvine

Sahil Railkar

University of California, Irvine - Department of Computer Science

Mary Kate Workman

University of Kansas - School of Law

Date Written: September 1, 2020

Abstract

In many legal frameworks, corporate directors are selected by shareholders. Proposed legislature in the US seeks to enable employee representation on corporate boards as well. Nevertheless, current approaches to corporate board selection could result in the systematic discounting of the needs of other, unrepresented stakeholder groups beyond shareholders and employees. To investigate this issue, we envisioned a new kind of corporate director—the environment-selected director—to complement shareholder-selected and employee-selected directors. We conducted an online simulation experiment where human participants were assigned to act as corporate directors, with some being told they were selected by shareholders, some by employees, and some via a “vote by a committee of scientists who study the local and global environment in question”. Results found that participants assigned as environment-selected directors exhibited balanced preferences across stakeholder groups, behavior significantly different from both shareholder-selected directors and employee-selected directors. Further results from 3000 “virtual boards of directors” suggest that boards composed solely of environment-selected directors produce more balanced benefits across all three stakeholder groups studied (shareholders, employees, and the environment) than other configurations of boards. These results suggest that it may be useful for future legislation to consider including this novel form of director, the environment-selected director, on corporate boards.

Keywords: Stakeholder Representation, Corporate Boards, Environment, Non-human Personhood, Accountable Capitalism Act

Suggested Citation

Tomlinson, Bill and Silberman, M. Six and Torrance, Andrew W. and Nikols, Nick and Black, Rebecca and Squire, Kurt and Atwal, Paramdeep Singh and Mandalik, Ameya and Railkar, Sahil and Workman, Mary Kate, “Environment-selected directors”: An interactive simulation experiment of environmental representation on corporate boards (September 1, 2020). Ecological Economics, Vol. 178, 2020, Available at SSRN: https://ssrn.com/abstract=

Bill Tomlinson (Contact Author)

University of California, Irvine ( email )

Bren Hall
Irvine, CA 92697-3440
United States

M. Six Silberman

IG Metall ( email )

Wilhelm-Leuschner-Straße 79
Frankfurt am Main, Hessen 60329
Germany

Andrew W. Torrance

University of Kansas - School of Law ( email )

Green Hall
1535 W. 15th Street
Lawrence, KS 66045-7577
United States

Nick Nikols

University of California, Irvine School of Law ( email )

401 E. Peltason Dr.
Ste. 1000
Irvine, CA 92697-1000
United States

Rebecca Black

University of California, Irvine ( email )

Campus Drive
Irvine, CA 62697-3125
United States

Kurt Squire

University of California, Irvine - Department of Informatics ( email )

Irvine, CA 92697-3440
United States

Paramdeep Singh Atwal

University of California Irvine ( email )

Division of Nephrology, University of California I
101 City Drive South, City Tower, Suite 400-ZOT;40
Orange, CA California 92868-3217
United States

Ameya Mandalik

University of California Irvine ( email )

Division of Nephrology, University of California I
101 City Drive South, City Tower, Suite 400-ZOT;40
Orange, CA California 92868-3217
United States

Sahil Railkar

University of California, Irvine - Department of Computer Science ( email )

Bren Hall
Irvine, CA 92697-3440
United States

Mary Kate Workman

University of Kansas - School of Law ( email )

Green Hall
1535 W. 15th Street
Lawrence, KS 66045-7577
United States

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