For nearly two decades, academics, public intellectuals, investment managers and sometimes even ordinary investors in highly developed economies have been engaged in public conversations around the purpose of the corporation. Specifically, whether corporate directors should focus their energies and corporate resources on environmental, social and governance (ESG) goals even when doing so may adversely impact corporate financial performance and shareholder value. The stakes at issue are quite high.
Join the UCLA School of Law’s Lowell Milken Institute for Business Law and Policy and UCLA Anderson Center for Global Management in hosting Christopher S. Tang, Distinguished Professor, Edward W. Chair in Business Administration and Faculty Director, Center for Global Management and Stephen Bainbridge, William D. Warren Distinguished Professor of Law for a presentation and discussion on the broad landscape of ESG and whether ESG is the road to a brighter future or a wrong turn in the history of the corporation and corporate governance.
Corporations, big and small, play a critical role in generating value in the economies of most developed nations. Historically, an investor has invested in a venture based upon the investor’s prediction of the venture’s ability to earn profits for the investor who, in turn, could use those profits at the investor’s discretion to fund whatever projects the investor believed was important (e.g., building a personal villa or supporting an environmental cause). The corporation was agnostic as to how its shareholder used the profits distributed by the corporation, even if the shareholder used distributions to fund movements or support legal changes detrimental to the corporation. With the ESG movement in the U.S. and elsewhere, corporations are principal actors in attempting to achieve certain broader societal goals, including environmental sustainability and social responsibility. In turn, requiring them to divert earnings away from shareholders to satisfy those goals, even if some shareholders do not share the belief that such goals are in the shareholders interest.
This event is for UCLA School of Law and UCLA Anderson students only. More information on the program can be found on the Global Business and Policy Forum webpage.