Commenting on Marshall Small's Article, the author agrees that there is a need to develop a corporate framework to resolve the often conflicting claims of investors and others affected by corporate conduct. Professor Schwartz contends that while Professor Small's Article addresses the role of directors in assuring corporate compliance with the law, he neglects to examine other possible alternatives for monitoring the corporation's performance in the broader social spectrum. In this regard, Professor Schwartz advocates greater emphasis on the often-overlooked shareholder aspect of the corporate governance process. This Article concludes that the often overlooked shareholder aspect of the corporate governance process is important, in and of itself, in the realm of corporate social responsibility, although shareholder proposals and nominations rarely prevail. Despite such failings, shareholder democracy achieves numerous beneficial results, such as providing additional expertise and influence to the shareholders. Moreover, the mere presence of an active shareholder body helps to insure socially responsible decisionmaking on the part of management.
Donald E. Schwartz,
Response: Some thoughts on the Director's Evolving Role,
30 Hastings L.J. 1405
Available at: https://repository.uclawsf.edu/hastings_law_journal/vol30/iss5/8