Roberto Tallarita (Harvard Law School) has posted Hohfeld in the Boardroom on SSRN. Here is the abstract:
For nearly a century, debates over corporate purpose have framed the issue as a clash between two contested visions: Should corporations maximize profits, or should they pursue broader social goals? This Article argues that this conventional framing obscures the true nature of the dispute. Using Wesley Hohfeld's map of rights, duties, privileges, and no-rights, I argue that the corporate purpose debate is fundamentally about the scope and design of managerial privilege, rather than abstract commitments to shareholders or stakeholders. The Article shows that traditional "shareholder primacy" and "stakeholder governance" theories are merely generalized permutations of Hohfeldian legal relations, which can and do co-exist in practice, and proposals for stakeholder governance often mask reforms that quietly expand managerial privilege while resting on risky empirical bets about corporate actors' benevolence. The Article proposes a pragmatic principle for designing stakeholder-oriented governance: expand managerial privilege only when the benevolence of the relevant corporate actors is verifiable; otherwise, pair privilege with enforceable duties or countervailing powers.
Highly recommended.