Month: February 2013

Who controls a corporation and what should its primary objective be? Over the last forty years, these questions have been answered principally by reference to an economically driven vision of the corporation. According to Professor Christopher Bruner, this view is insufficient because it fails to account for the social and political realities that have affected the corporate form, while providing no compelling vision for what corporations should do.

Professor Bruner was first drawn to such questions as a law student, but his approach was deeply influenced by his pre-law studies in the humanities. “I am very interested in social and cultural dimensions of economic law and how they impact general social welfare,” he says.

This broad outlook permeates his scholarship. For example, in an article titled Culture, Sovereignty, and Hollywood: UNESCO and the Future of Trade in Cultural Products, 40 N.Y.U. J. Int’l L. & Pol. 351 (2008), Bruner examines a recent treaty legitimating national laws that establish trade protections for domestic products deemed “cultural,” such as films and television shows. This treaty – championed by Canada and France – was adopted nearly unanimously (148-2) over the vocal opposition of the United States. Arguments for free trade and free speech, though theoretically compelling, were not enough to derail the treaty because of the powerful impetus most countries felt to protect their homegrown media from domination by Hollywood. According to Bruner, the U.S. failed to persuade other countries because our position relied too heavily on the theoretical merits of free trade and failed to take seriously the valid cultural concerns of other countries.

The importance of social and cultural context to economic law has loomed large in his more recent scholarship, which has increasingly focused on comparative corporate law and governance. In Power and Purpose in the “Anglo-American” Corporation, 50 Va. J. Int’l L. 579 (2010)  ) – an early version of which won the  the 2010 Association of American Law Schools Scholarly Papers Competition – Bruner investigates a striking divergence between U.S. and U.K. corporate law. While comparative legal scholars typically lump together British and American corporate law as a single “Anglo-American” system, Bruner teases out substantive and crucial distinctions in their respective degrees of shareholder-orientation, a divergence emerging most clearly in the context of hostile takeovers. In the U.K., shareholders have a nearly unfettered right to accept deals maximizing their own returns. In the U.S., however, the shareholders’ prerogative to seek the most profit is tempered substantially by protections for employees and other stakeholders. Through a detailed historical investigation, Bruner argues that social and political factors provide the most compelling explanation of this divergence—namely substantial differences in the two countries’ approaches to social welfare policy. In the U.S., where the social safety net remains relatively weak compared to the U.K., far greater social and political pressure has been brought to bear on corporate law to show regard for the concerns of employees. In short, corporate law can be fully understood only by reference to surrounding social and political conditions.

Professor Bruner’s current work continues to argue against the fallacy of understanding corporate law in a vacuum. In two more recent articles – Corporate Governance Reform in a Time of Crisis, 36 J. Corp. L. 309 (2011), and Conceptions of Corporate Purpose in Post-Crisis Financial Firms, 36 Seattle U. L. Rev. (forthcoming 2013) – Bruner critiques shareholder-centric reforms adopted in the wake of the crisis against the backdrop of his prior work. His new book, titled CORPORATE GOVERNANCE IN THE COMMON-LAW WORLD: THE POLITICAL FOUNDATIONS OF SHAREHOLDER POWER (Cambridge University Press, forthcoming 2013), extends and deepens his arguments about the importance of social and political context to corporate law, developing a new comparative theory of corporate governance in common-law countries through analysis of Australia, Canada, the U.K., and the U.S. Moving forward, Bruner plans to extend his comparative scholarship to financial systems more generally.