ABSTRACT
The article provides a historical context of the most iconic case in corporate law, Dodge v Ford Motor Co. The case famously asserted that ‘there should be no confusion’ that corporate purpose is ‘primarily for the profit of the stockholders’. This statement succinctly encapsulates the idea of shareholder primacy, the corporate rule requiring managers to prioritize profit maximization over other interests. A unique period in history gave rise to this political statement. Overt politicism explains why the case split the panel of judges then, and why Dodge was never influential among courts and was ignored by academics until the neoliberal turn of the 1980s. For much of the twentieth century, American capitalism had no use for the idea in Dodge because shareholder primacy conflicted with the prevailing political order and economic system. Dodge found late influence in legal academia only when America embraced neoliberalism. Its pithy shibboleth fit the moment when intellectualization was needed for a new economic system based on the policy preference for capital …
Rhee, Robert J, The Neoliberal Corporate Purpose of Dodge v Ford and Shareholder Primacy: A Historical Context 1919-2019 (August 19, 2022), 28 Stanford Journal of Law Business and Finance (2023); University of Florida Levin College of Law Research Paper No 23-9.
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