For thirty years, the economic analysis of corporate law has been based on the assumption that shareholder value is a reliable proxy for social welfare. However, for some time now, the large majority of the shares in some public companies have been held by institutional investors, including pension funds and mutual funds. These investors have some incentive to favor short-term profits at the expense longer-term benefits. Can shareholder value still be reliably equated with social welfare? Or does the current incentive structure encourage the misallocation of resources and a net social loss?
The Federalist Society's Corporations, Securities & Antitrust Practice Groups presented this panel on "The Short-Termism Debate" on Thursday, November 13, during the 2014 National Lawyers Convention.
- Prof. Lucian A. Bebchuk, William J. Friedman and Alicia Townsend Friedman Professor of Law, Economics, and Finance and Director of the Program on Corporate Governance, Harvard Law School
- Prof. Jonathan R. Macey, Sam Harris Professor of Corporate Law, Corporate Finance, and Securities Law, Yale Law School
- Prof. Robert T. Miller, Professor of Law and F. Arnold Daum Fellow in Corporate Law, University of Iowa College of Law
- Mr. Steven A. Rosenblum, Wachtell, Lipton, Rosen & Katz
- Moderator: Hon. E. Norman Veasey, Former Chief Justice, Delaware Supreme Court