From shareholder primacy to stakeholder capitalism

To start with the most important example, Delaware’s corporate code does not say anything about corporate purpose other than to reaffirm that corporations “can be formed to conduct or promote any lawful business or purposes.”39 A majority of the remaining state corporate statutes contain provisions that reject shareholder primacy by providing that

so-called great risk shift, through which corporate America has stabilized its own income statements over a generation by off-loading uncertainty onto workers; and the ways in which shareholders were running companies more and more for themselves, to the detriment of every other stakeholder.

The Committee for Economic Development,2 with its track record since the post-war period of engaging business leadership to confront global issues and shape public policy, published the Social Responsibilities of Business Corporations3 in 1971. It presented the idea of a social contract between business and society, where corporations exist as a re