Endorsed by more than 250 leading international academies, the Modern Corporation Project at Cass Business School has released five statements, which reveal a new vision for corporate governance. High-level experts in a variety of legal systems helped to devise the statements, which cover company law, economics, management and politics. The goal of the declarations is to foster debate about corporate governance and to provide cross-jurisdictional and cross-disciplinary consensus.
A few of the signatories include Lynn Stout, professor of corporate and business law at Cornell University, Charles Perrow, emeritus professor of sociology at Yale University and Simon Deakin, professor of law at the University of Cambridge. Overall, the work was coordinated by Dr. Jeroen Veldman, senior research fellow at Cass Business School, and supported by the Purpose Corporation Project led by Frank Bold.
The reason for the statements was a need to rethink corporate governance, revealed the press release. Since the 1970s, the framework has been narrowing, and many businesses have begun to take excessive risks at the expense of corporate resilience and long-term sustainable value. The old structure also took away focus on R&D as well as innovation and human and social capital. It also helped to contribute to rising inequality within firms, and it became a source of political and economic turmoil.
The new statements take into account the broadly accepted idea that the world’s largest publicly traded corporations need to be governed with an eye toward society and the environment. They provide a set of fundamentals that are applicable in almost all jurisdictions that can help prevent errors and provide a broader basis for corporate governance theory and practice.
The five statements summarize the findings discovered during a series of international roundtables with over 240 thought leaders in business management, investment, regulation and academic and civil society communities. They identify the desired outcomes and principles of corporate governance that is fit for the 21st century.
You can read the new statements below:
- Statement on Company Law:https://ssrn.com/abstract=2848833
- Statement on Management:https://ssrn.com/abstract=2863077
- Statement on Accounting: https://ssrn.com/abstract=2863935
- Statement on Economics: https://ssrn.com/abstract=2864246
- Statement on Politics:https://ssrn.com/abstract=2864474