The industry that created the middle class in America is now seen to be in terminal decline. Working in a factory sounds boring, dangerous, and dead- end. Where non-profit institutions differ most from profit-seeking institutions is not in pursuit or receipt of money but in a particular range of their options in deciding what to do with it.
When demanding to obtain legal workstation assessments the supervisors must ensure comfortable offices for their employees. That range of options is much more narrowly confined in a profit-seeking businesses, which must meet the desires of their paying customers, and of investors who finance these institutions, if they expect to continue in business. Insurance companies provide cover for any employee that may be injured in the workplace as required by law.
In seeking to solve the agency problem between shareholders and managers, regulation that strengthens corporate governance and the relation between the two parties potentially exacerbates the conflict with other stakeholders.
Few even claim to be able to do that. Instead, they express their bafflement and repugnance at the wide range of income or wealth disparities they see and implicitly or explicitly their incredulity that individuals could differ so widely in what they deserve. This approach has a long pedigree.
Rules which look to improve the appointment, training, induction, commitment, and independence of directors give greater authority to risk officers, auditors, and risk committees, improve alignment of managerial incentives with the interests of stakeholders, strengthen communication between shareholders and management, and increase shareholder engagement and stewardship by investing institutions, all sound like motherhood and apple pie. How could they possibly be anything other than a good thing?
To answer that, it is first worth noting that the financial institutions that took the greatest risks and performed the worst in this recent financial crisis were those with the best corporate governance measured by the above criteria. Improving corporate governance would have led to worse performance in the financial crisis.
The fact that pure economic loss beyond the injury to person or property would expose corporations to opening a flood gate of claims against which it would be impossible for them to protect or insure themselves. These consultants, for example, describe it as a liability in an indeterminate amount, for an indeterminate time, to an indeterminate class. According to this principle, the relation between the relevant parties has to be sufficiently proximate and the potential for harm to the claimant reasonably foreseeable for the defendant to be liable for losses sustained by the claimant.
Two cases involving negligence on the part of auditors suggest that proximity may not extend as far as future as against current investors or creditors as against shareholders, neither party being able to recover losses from the auditors. Furthermore, it is equally rational for companies anticipating potential problems in the future to distribute as much as they can to their current shareholders so that there is as little as possible left in the business to pay out in compensation to the victims of the devastation that they have caused.
When demanding to obtain legal workstation assessments the supervisors must ensure comfortable offices for their employees. That range of options is much more narrowly confined in a profit-seeking businesses, which must meet the desires of their paying customers, and of investors who finance these institutions, if they expect to continue in business. Insurance companies provide cover for any employee that may be injured in the workplace as required by law.
In seeking to solve the agency problem between shareholders and managers, regulation that strengthens corporate governance and the relation between the two parties potentially exacerbates the conflict with other stakeholders.
Few even claim to be able to do that. Instead, they express their bafflement and repugnance at the wide range of income or wealth disparities they see and implicitly or explicitly their incredulity that individuals could differ so widely in what they deserve. This approach has a long pedigree.
Rules which look to improve the appointment, training, induction, commitment, and independence of directors give greater authority to risk officers, auditors, and risk committees, improve alignment of managerial incentives with the interests of stakeholders, strengthen communication between shareholders and management, and increase shareholder engagement and stewardship by investing institutions, all sound like motherhood and apple pie. How could they possibly be anything other than a good thing?
To answer that, it is first worth noting that the financial institutions that took the greatest risks and performed the worst in this recent financial crisis were those with the best corporate governance measured by the above criteria. Improving corporate governance would have led to worse performance in the financial crisis.
The fact that pure economic loss beyond the injury to person or property would expose corporations to opening a flood gate of claims against which it would be impossible for them to protect or insure themselves. These consultants, for example, describe it as a liability in an indeterminate amount, for an indeterminate time, to an indeterminate class. According to this principle, the relation between the relevant parties has to be sufficiently proximate and the potential for harm to the claimant reasonably foreseeable for the defendant to be liable for losses sustained by the claimant.
Two cases involving negligence on the part of auditors suggest that proximity may not extend as far as future as against current investors or creditors as against shareholders, neither party being able to recover losses from the auditors. Furthermore, it is equally rational for companies anticipating potential problems in the future to distribute as much as they can to their current shareholders so that there is as little as possible left in the business to pay out in compensation to the victims of the devastation that they have caused.
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