ABSTRACT
The thesis of this Article is that the ESG movement has been stunted by the failure to appreciate a trilemma: you cannot have responsive governance, liquid shares, and a credible commitment to social mission. The Article provides a novel descriptive account of corporate purpose and develops a transaction cost explanation for the collective action problem faced by pro-social investors. The Article identifies institutional solutions—and their trade-offs – for founders and investors that prefer to establish pro-social businesses. The analysis justifies business judgment rule review of disputes about corporate purpose and produces counterintuitive insights into corporate governance matters.
Patrick M Corrigan, The corporate governance trilemma, Journal of Legal Analysis, volume 17, issue 1, pages 141-165 (2025). Published: 16 September 2025.
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