Corporate law, corporate boards, board of directors, directors, corporate governance
The contemporary state of corporate law in the United States is one that is skewed toward the archaic principle of shareholder primacy. This narrow conception of corporate purpose has resulted in governance mechanisms that tend to overlook the many stakeholders that are affected by, and, in turn, affect the bottom line of modern corporations. In the wake of the recently proposed Accountable Capitalism Act, this Note investigates the viability of adopting a system of mandated worker board representation—codetermination—in the United States. The Note employs a comparative analysis of the German and Swedish experiences with codetermination, and then evaluates the policy, efficiency, and legal arguments made by prominent scholars and experts in the field of comparative corporate law. This Note begins by examining the history of codetermination in Germany and Sweden. It then details several pertinent developments in United States corporate law and reflects on how these developments have affected the economy. Next, it introduces relevant arguments for and against codetermination that are rooted in economic and legal considerations. This Note then proposes a set of parameters for the adoption of codetermination in the United States—primarily maintaining a single-tier board structure and mandating a nationwide, industry-wide application. Finally, due to the unpredictability of transplanting foreign governance mechanisms, it calls for additional research and constructive debate on the topic.
Julian Constain, Note, A New Standard for Governance: Reflections on Worker Representation in the United States, 24 FORDHAM J. CORP. & FIN. L. 409 (2019).