Class 1

• Push for more independent directors instead of managing directors
• Independent, disinterested director

Two duties: Loyalty + Care

Shareholder primacy, yes or no?

• Well, what’s the purpose of the corporation?
• Contractarian theory of the corporation: Firm is a nexus of contracts.
• Shareholders as the residual risk bearers. Everyone else is getting paid, so they should get someone acting in their interest.
• Delaware law = one of many shareholders, agent of residual risk bearer

Duty of Care

• Avoid pressure and push back
• Bring in outside experts
• “we made our decision after careful consideration of what would be in the best long-term interests of the company and its shareholders