Ira Millstein: Stakeholder Capitalism Is Slowly Advancing – WSJ

Ira Millstein’s letter calls for more optimism on the BRT’s stakeholder claims, though (1) he admits he has no data to support it and (2) even he does not expect the executives who make the claim of a stakeholder focus to deliver; he thinks it will be the result of market forces from outside the…

‘Stakeholder’ Talk Proves Empty Again – Lucian A. Bebchuk and Roberto Tallarita

Lucian A. Bebchuk and Roberto Tallarita update their previous research and show that the Business Roundtable CEOs who promised two years ago to shift their priorities to stakeholders…didn’t. We’ve identified almost 100 signatory companies that updated their corporate governance guidelines by the end of 2020. We found that the companies that made updates generally didn’t add any…

Danone board ousts ESG Advocate Emmanuel Faber as chief and chairman | Financial Times

Danone’s board of directors has decided to replace Emmanuel Faber as chief executive and chairman, bowing to pressure from activist investors and blowing up a two-week-old compromise designed to have him remain as chairman….Activist investors attacked Danone for what they cast as its chronic underperformance compared with larger rival Nestlé, and publicly called for Faber’s…

Proposal With Caveat: A Purpose-Based Corporation

Shareholder value maximization has been severely criticized in recent years, but it is not clear what if anything is to take its place. In this paper we review three models of corporate value creation – shareholder value, stakeholder value and company purpose achievement – and their implications for corporate governance. We first discuss shareholder value and how…

Antitrust law: The next stakeholder capitalism battleground? | Fortune

[S]ome reformers have called to replace the “consumer welfare” standard with “effective competition,” using antitrust to “protect” market participants throughout the supply chain, including workers. Others propose that enforcers seek “stakeholder remedies,” such as changes to corporate governance, as part of antitrust enforcement.  Need to clear that merger? Fork over a few board seats to…

How’s the CEO ‘Stakeholder Pledge’ Working Out? Depends Who You Ask – WSJ

VEA Vice Chair Nell Minow is quoted in this WSJ column by John Stoll about the BRT’s stakeholder rhetoric. Nell Minow, vice chair of ValueEdge Advisors, which consults with institutional investors on corporate governance, agrees with Mr. Bebchuk about tradeoffs, but she cautions “those tradeoffs are rarely permanent.” She said directors need to push executives…

The BRT’s Fake Stakeholder Promise: One Year In

A year from the Business Roundtable’s announcement that they were broadening their focus on stakeholders, what are the results? Unsurprisingly, the BRT gives itself an A. Executive Director Joshua Bolten writes in the Wall Street Journal: The CEOs who signed the new statement believe it better reflects their conviction that businesses can’t flourish over the…

‘Stakeholder’ Capitalism Seems Mostly for Show – WSJ

We said as soon as they accounted it that we did not believe the Business Roundtable’s new claims of commitment to stakeholders. Now Lucian Bebchuk and Roberto Tallarita confirm that we were right to be skeptical. By putting American workers through months of turmoil, the Covid-19 crisis has heightened expectations that large companies will serve…