A review of Washington and Lee law professor Christopher Bruner’s recent book, Corporate Governance in the Common-Law World: The Political Foundations of Shareholder Power, has been published by the Texas Law Review. The review was authored by David Skeel, S. Samuel Arsht Professor of Corporate Law at the University of Pennsylvania Law School.
Professor Bruner’s book, published in 2013 by Cambridge University Press, examines the corporate governance powers possessed by shareholders in the U.S. and other common-law countries. Bruner finds, contrary to popular belief, that shareholders in the U.K. and other common-law jurisdictions are both more powerful and more central to the aims of the corporation than are shareholders in the U.S. Bruner’s theory is that relatively robust social welfare protections in countries like the U.K., Australia and Canada have freed up their corporate legal systems to focus more intently on shareholder interests without giving rise to “political backlash” – because other legal structures accommodate the interests of employees.
While “playing devil’s advocate” in his review, Professor Skeel concludes that “Bruner’s insights are a revelation,” and that the book “has identified a critical, new dimension of our understanding of corporate law.” Skeel adds:
Bruner’s claim that strongly shareholder-oriented governance—which sniffs of Wall Street rather than Main Street—is associated with robust social welfare protections—which sounds much more like Main Street—is both counterintuitive and plausible. Even if Bruner had not marshaled extensive supporting evidence, it would be a thesis that corporate law scholars, and perhaps social welfare experts as well, would need to grapple with. The elaborately detailed case that Bruner presents adds to its importance.