The GameStop and meme-stock trading frenzy are evidence of a potential revolution in corporate governance and signal the rise of Generation Y (“Millennials”) and Generation Z (“GenZ”) as retail investors. In a new article, we discuss how these investors, who we call wireless investors, could set in motion a social movement able to change the way shares are held and voted and, ultimately, redefine the purpose of public corporations. The social movement will start with…

Global greenhouse gas (GHG) emissions decreased by 6.4% in 2020, largely due to the COVID-19 pandemic. While encouraging at first glance, many climate change experts have pointed out that this result will have hardly any long-term effect on curbing climate change. The link between economic activity and emissions is hard to ignore. As was noted recently in Nature, China is a good example of this. Its emissions reduced significantly early in the year but…

The new wave of financial economics empirical scholarship has revitalized what had been theoretical discussions about the effects of common ownership in both economics and law.  Common ownership within the same industry by mutual funds may create incentives for those funds to maximize the returns of their portfolio through collusion rather than to maximize the value of any particular company within its portfolio.  An institutional investor that has stakes in firms A, B, and C,…

Individually or collectively, corporate leaders are promising stakeholders to improve corporate practices on a range of issues. In a new article, I argue that they can demonstrate their commitment to stakeholders by designing contracts differently. We are already attentive to the ways that stakeholders are harmed by the contracts they enter into directly with corporations.  This awareness has raised concerns over contracting practices and bargaining power, information asymmetries, and informed consent.  In my article, I…

The Big 3 mutual-fund managers (BlackRock, State Street, and Vanguard) have amassed incredibly large public-company holdings through the array of mutual funds they oversee.  As a result, they now play a pivotal role in corporate governance in many of the world’s largest and most important companies. A key concern is whether the Big 3 use their powerful voice in corporate affairs to good effect.  Professors Lucien Bebchuk and Scott Hirst argue that they neglect their…

Together with other European Corporate Governance Institute (ECGI) research members, we have recently issued a Call for Reflection on Sustainable Corporate Governance to express our concerns over the risk that new legislation on EU companies’ governance is adopted without properly considering the concerns raised by many academics and interested parties during the consultations that have taken place so far. These concerns, as detailed below, focus on the three misconceptions in the approach of the European…

On April 22, a unanimous U.S. Supreme Court held in AMG Capital Management, LLC v. Federal Trade Commission[1] that Section 13(b) of the Federal Trade Commission Act does not give the Federal Trade Commission the authority to seek (or authorize a court to award) equitable monetary relief such as restitution or disgorgement.  In so holding, the Court relied principally on the plain text and structure of Section 13(b), as well as that provision’s place in the…