• Lucian Bebchuk


May 9, 2022, Paper: "Unlike shareholder value maximization (SV), which calls on corporate leaders to maximize shareholder value, enlightened shareholder value (ESV) combines this prescription with guidance to consider stakeholder interests in the pursuit of long-term shareholder value maximization. In a forthcoming article we recently placed on SSRN, Does Enlightend Shareholder Value Add Value?,  we show that replacing SV with ESV should not be expected to benefit stakeholders or society. We begin by explaining that the appeal of ESV and the enthusiasm for it among supporters seems to be grounded in a misperception about how frequent “win-win situations” are. In the real world, corporate leaders often face significant trade-offs between shareholder and stakeholder interests, and such situations are exactly those for which the specification of corporate purpose is important."

Non-HKS Faculty Author Website - Lucian Bebchuk