The Tax Cuts and Jobs Act: Welcome to the Republic of Shareholder Primacy

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I am a corporate lawyer and I love corporations, but I can’t in good conscience support the tax bill percolating in Congress. For the last 33 years, I have made my living in Silicon Valley representing approximately two dozen public and several hundred private corporations as outside general counsel. Under the prevailing corporate law of Delaware, the corporation has but one legitimate purpose: to maximize stockholder… [Continue reading this post]

Why Silicon Valley is not Our Friend and How It Could Befriend Us

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Amazon, Apple, Facebook and Google are not our friends as highlighted in the New York Times Sunday Review. The truth is that the ultimate core value of Amazon, Facebook and Google (Alphabet), which are Delaware corporations, and Apple, which is a California corporation, is the imperative to maximize stockholder welfare. This doctrine, which is known as shareholder primacy and is embedded in the prevailing corporate… [Continue reading this post]

Benefit Corporation Law and Governance: Why Isn’t Your Company a Benefit Corporation Yet?

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Rick Alexander’s Benefit Corporation Law and Governance: Pursuing Profit with Purpose is the most important book about corporate law in decades, if not ever.  Mr. Alexander, Director of Policy at B Lab, senior Delaware corporate lawyer and co-drafter of Delaware’s benefit corporation legislation, has just published a legal masterpiece that will be the definitive guide to the benefit corporation and shape the post-shareholder primacy economy… [Continue reading this post]

How to Make Conscious Capitalism Whole: Thank You Whole Foods

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With today’s completion of Amazon’s acquisition of Whole Foods, Conscious Capitalism lost its leading proponent. As a wholly owned subsidiary of Amazon, Whole Foods lost its independence and position as thought leader for the Conscious Capitalism movement. Although Conscious Capitalism and John Mackey have put a positive spin on the acquisition and expressed optimism about their ability to inspire Amazon to adopt the principles of Conscious… [Continue reading this post]

The MultiCapital Scorecard: How Multiple Capital Accounting May Save the Planet

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If you were given the job of re-designing the global economic system so that it not only provides for humanity’s needs but also ensures that we maintain the planet’s ability to sustain human civilization, where would you start? How could you implement your plan so that it creates a more sustainable economy as rapidly as the Marshall Plan re-built Western Europe after World War II?… [Continue reading this post]

Why Laureate Education’s IPO Matters to Silicon Valley

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Laureate Education just made it safe for entrepreneurs, lawyers and venture capitalists to incorporate and build startups as benefit corporations. After 18 months in registration, Laureate Education went public on February 1, 2017 as the first publicly listed benefit corporation. By completing its IPO and raising $490 million, Laureate Education legitimized this seven year old corporate form. With Credit Suisse, Morgan Stanley and Barcley’s as lead… [Continue reading this post]

How the Benefit Corporation Could Help President Trump Make America Greater

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I edited President Trump’s inaugural address below because he senses that something is not quite right with corporate America but does not name it. He persuaded Carrier to keep a factory and its jobs in the US and not move them to Mexico. He is wrangling cost concessions from Lockheed-Martin on the most expensive fighter jet program ever. He threatens to impose tariffs on the… [Continue reading this post]

From Good to Great to Discourteous: How Wells Fargo Can Be Great Again

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(originally published on Linked In on September 29, 2016) Wells Fargo Bank was one of America’s best companies. Jim Collins profiled Wells Fargo in Good to Great. Legendary value investor Warren Buffet owns approximately 2,000,000 shares and his Berkshire Hathway holds a 9.5% stake in the company. Wells Fargo easily weathered the financial crisis of 2008 and its quality of management was rewarded with a… [Continue reading this post]

Can Conscious Capitalism Be More Effective?

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(originally published on Linked In on September 6, 2016) Conscious Capitalism espouses a multiple stakeholder, multiple purpose approach to business within the constraints of a single stakeholder, single purpose legal system. It works, but the fit is not optimal. The benefit corporation appears custom-made to liberate the Conscious Capitalism movement from these constraints because it legitimizes a multiple stakeholder, multiple purpose approach to business. Conscious… [Continue reading this post]

What Corporate Lawyers (and Directors) Need to Know about the Benefit Corporation

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(Originally published on Linked In on August 12, 2016) If you’d like to become expert in the newest evolutionary corporate form—the benefit corporation—and master the delicate board and stockholder politics that arise when your clients adopt this new entity, then this post is for you. This post, which was one of five articles about the benefit corporation in the July edition of the American Bar… [Continue reading this post]