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45 Wm. & Mary L. Rev. 1055 (2003-2004)
A Systems Approach to Corporate Governance Reform: Why Importing U.S. Corporate Law Isn't the Answer

handle is hein.journals/wmlr45 and id is 1069 raw text is: A SYSTEMS APPROACH TO CORPORATE GOVERNANCE REFORM: WHY IMPORTING U.S. CORPORATE LAW ISN'T THE ANSWER TROY A. PAREDES* TABLE OF CONTENTS INTRODUCTION ........................................ 1056 I. THE COMPARATIVE CORPORATE GOVERNANCE DEBATE: DOES LAW MATTER? ............................... 1061 A. Law M atters ................................... 1063 B. Transplanting U.S. Corporate Law ................ 1070 II. THE U.S. CORPORATE GOVERNANCE SYSTEM ........... 1075 A. The Formal Rules of the Game .................... 1077 B. Why Do Shareholders Still Invest? ................. 1085 C. Overall Coherence and System Logic.............. 1101 III. IS THE U.S. CORPORATE GOVERNANCE SYSTEM TRANSPLANTABLE? ........................... 1103 A. Complementarities Critique ....................... 1105 B. Private Ordering Critique ........................ 1109 C. Nonshareholder Primacy Critique ................. 1116 D. Capital Structure Critique ....................... 1121 IV. LESSONS FOR DEVELOPING COUNTRIES: A FRAMEWORK FOR CORPORATE GOVERNANCE REFORM ................... 1122 A. When Law Really Matters ........................ 1122 B. Ground-Level Benefits of Mandatory Corporate Law . 1133 C. Some Proposals to Consider ...................... 1145 CONCLUSION ......................................... 1155 * Associate Professor of Law, Washington University School of Law. Special thanks to Chris Bracey, John Drobak, Frances Foster, John Haley, Bill Jones, Eric Kades, Scott Kieff, Brett McDonnell, Thomas Merrill, Peter Mutharika, Andrzej Rapaczynski, Ted Ruger, and Joel Seligman for helpful comments and discussions in the writing of this Article. Of course, I take responsibility for all remaining mistakes. 1055