Directors’ Duties and Sustainable Corporate Governance

The videos are available here

The programme can be downloaded here.

About this workshop

The European Commission recently published a study by Ernst & Young (EY) on directors’ duties and sustainable corporate governance commissioned in 2019. Studies of this type are usually a stepping stone for policy proposals that will be put forward for consideration by EU Member States and the European Parliament. In the words of the Commission:

“the Study found a clear trend of short-termism in the focus of EU companies. It identified key drivers of this issue, ranging from the narrow interpretation of directors duties and the company’s interest with the tendency to favour the short-term maximisation of financial value, through growing pressure from investors and the lack of a strategic perspective on sustainability all the way to the limited enforcement of the directors’ duty to act in the long-term interest of company. In order to lengthen the time horizon in corporate decision-making and to promote a corporate governance that is more conducive to sustainability, the Study also identified specific objectives that EU intervention could aim to reach”.

The study identifies a number of policy options for the European Commission to consider (summarised at pp. 51-60), which may deeply impact corporate law and governance across the European Union. Topics include directors’ duties, the company’s purpose, corporate disclosures, executive compensation, and engagement with stakeholders. The European Commission has conducted a public consultation on these policy options, that closed on 8 October 2020, and is expected to issue proposals at the beginning of 2021, if not earlier.

ECGI held an online roundtable to discuss the report, the academic literature, and recommendations on the topics referenced in the report.

Useful links:

Watch recordings of the workshop | Summary article | Summary Report

EY Report:
All Public Responses to the Consultation:
Submitted Response from Wolf-Georg Ringe:
Submitted Response from Paul Davies and Rolf Skog (ECLE group):
Submitted Response from Mark Roe and Holger Spamann:
Submitted Response from Alex Edmans:
Submitted Response from Steen Thomsen: and

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Can Purpose Deliver Better Corporate Governance?

Can Purpose Deliver Better Corporate Governance?


John Almandoz, IESE; Marco Becht, Solvay Brussels School and ECGI; Jordi Canals, IESE; Fabrizio Ferraro, IESE; Mireia Giné, IESE and ECGI; Colin Mayer, University of Oxford and ECGI; Joan Enric Ricart, IESE; Paola Sapienza, Kellogg School of Management and ECGI.

About this event

The notion that companies should have a corporate purpose or mission that goes beyond financial performance has been considered in the fields of management, organisational behaviour, law and the economics of organisations for a long time. But the increasing weight of ESG dimensions in corporate governance and asset management, the call for positive societal impact, and the competition to attract and retain top talent -among other factors- draws us firmly closer to a deeper consideration of corporate purpose. At this turbulent time, ‘Corporate Purpose’ has galvanised a global movement that promises to restore trust in companies, to produce goods and services without doing harm, while providing a fair return to employees and shareholders.

Many of the world’s most valuable companies already have a clear purpose. With a swelling of public discourse, the markets have joined the movement calling on businesses to make a positive contribution to society and to refocus corporate governance around a multi-stakeholder perspective. As businesses in turn, reflect on their purpose, they must also consider the questions that complicate the implementation of a vision or purpose and make it meaningful.

This conference focused on the connection between purpose and governance. It brought together leading scholars, including Nobel Laureate Bengt Holmström, from the fields of strategy, organisational theory, organisational economics, finance and corporate law to address these important questions with thoughtful business executives, corporate lawyers, asset managers and board directors from a variety of sectors. The event encouraged a dynamic interaction between scholars and corporate leaders.


For queries, please contact Félix Sánchez, IESE CCG Manager:


John Almandoz (IESE); Marco Becht (Solvay Brussels School, ECGI and CEPR); Patrick Bolton (Columbia University and ECGI); Jordi Canals (IESE); Fabrizio Ferraro (IESE); Jill E. Fisch (University of Pennsylvania Law School and ECGI); Caroline Flammer(Boston University’s Questrom School of Business); Claudine Gartenberg (The Wharton School at the University of Pennsylvania); Mireia Giné (IESE and ECGI); Jordi Gual (CaixaBank); Rebecca Henderson (Harvard Business School); Bengt Holmström (MIT and ECGI);  Sophie L’Hélias (LeaderXXChange and ICGN); Baroness Denise Kingsmill (Inditex and IAG) ; Juvencio Maeztu (CEO of IKEA); Colin Mayer (Saïd Business School, University of Oxford, British Academy and ECGI); Paul Polman (former CEO of Unilever); Joan Enric Ricart (IESE); Henry Tricks (The Economist); José Viñals (Chair, Standard Chartered); Xavier Vives (IESE Business School and ECGI); Ernst-Ludwig von Thadden (University of Mannheim and ECGI); Luigi Zingales (University of Chicago Booth School of Business and ECGI)

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Rethinking Stewardship

Rethinking Stewardship

The live stream of the event is available to watch on YouTube:

About this event

The reconcentration of share ownership into the hands of a small number of institutional investors holding broadly diversified portfolios has led to calls for adoption of a particular corporate governance stance by these investors, “stewardship.”  Indeed, many jurisdictions, following the lead of the UK, have adopted stewardship codes into their regulatory framework.  “Stewardship” has generally been taken to mean engagement with portfolio companies in view of long term shareholder interests, though some have argued for a broader conception of stewardship obligations. Since companies are likely to be responsive to the convictions of their largest shareholders, one especially important question is how particular models of stewardship will affect the way that public companies frame and address the ESG issues now urged upon them.

The goal of the conference was to examine this conception of stewardship for its “fit” with current practices of institutional investors, the “products” that asset managers offer to beneficial owners, and the diverse patterns of ownership and economic development throughout the world.  In short, the goal was to “Re-Think Stewardship.”

Prof. Lucian Bebchuk (Harvard Law School and ECGI) argued that a particularly important class of institutional investors, index funds, significantly underinvest in stewardship, and are excessively deferential to corporate managers, relative to what would best serve the interests of the funds’ beneficial investors.

Prof. Jeffrey Gordon (Columbia Law School and ECGI) presented an alternative conception of stewardship, “systematic stewardship,” appropriate for maximally diversified investors, based on the distinction in Modern Portfolio Theory between idiosyncratic and systematic risk. Thus institutional investors can take up issues like climate change, which affect the level of systematic risk, consistent with a finance rationale of trying to achieve the best risk-adjusted return for their investors.

Prof. Dionysia Katelouzou (King’s College London) presented the findings from her empirical analysis of the rhetoric of stewardship by activist hedge funds in the UK, which uses the novel method of automated content analysis, and she contended that we can learn a lot from the UK stewardship model especially when institutional investors dominate the public equity market. Prof. Dan Puchniak, (National University of Singapore) then contended that the relative weakness of institutional investors and dominance of controlling shareholders in non-Anglo-American jurisdictions makes the widespread transplant of UK-style stewardship codes a “global legal misfit” – resulting in stewardship functioning in diverse and unanticipated ways around the world.

Chief Justice (ret) Leo Strine (Delaware Supreme Court) delivered a keynote address that addressed stewardship both from the doctrinal perspective of a judge and a view of the role of institutional investors in promoting fair and sustainable capitalism.

The papers were discussed by panelists from globally significant asset managers, legal scholars and other researchers, and corporate governance practitioners.


Ira M. Millstein Center for Global Markets and Corporate Ownership, Columbia Law School

European Corporate Governance Institute (ECGI)

Center for Law and Economic Studies, Columbia Law School


You can download the event programme here

Reading material can be downloaded here


Programme queries should be directed to Jeff Gordon (

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