David Webber, a leading expert in corporate law and shareholder activism, predicts that the social activism of Millennial shareholders will lead to significant changes in corporate governance. CEOs from the nation’s leading companies appear to agree.
Today, the Business Roundtable, an organization representing chief executive officers from the United States’ leading companies, released a statement calling into question the longstanding principle that a corporation’s sole purpose is to generate value for its shareholders.
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The statement, signed by 181 CEOs from major corporations such as Walmart, American Airlines, and Exxon Mobil, expands the purpose of a corporation to include delivering value to customers, investing in employees, treating suppliers ethically, supporting their communities, and protecting the environment.
David Webber, associate dean for intellectual life and professor of law at Boston University School of Law, is a leading expert in corporate law and shareholder activism who has written extensively on topics related to corporate governance. In an article released today, Webber and his co-authors—Michal Barzuza and Quinn Curtis from the University of Virginia School of Law—argue that "in focusing on the conventional framework of shareholder value maximization, critics have overlooked that index funds have been outspoken, confrontational, and effective advocates of activist campaigns oriented to social responsibility."
Writing about Webber's 2018 book The Rise of the Working-Class Shareholder from Harvard University Press, the New York Review of Books says that "Webber makes a persuasive case for the potential power of pension funds" to influence corporate executives to consider factors other than maximizing shareholder value when making decisions.
Webber's work has appeared in the New York Times, the Chicago Tribune, the Los Angeles Times, and the Washington Post, among other outlets.