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15 Windsor Rev. Legal & Soc. Issues 113 (2003)
A Modern Approach to Redefining in the Best Interests of the Corporation

handle is hein.journals/wrlsi15 and id is 117 raw text is: In the Best Interests of the Corporation A MODERN APPROACH TO REDEFINING IN THE BEST INTERESTS OF THE CORPORATION Tuvia Borok* Notions of corporate law and corporate governance often rest upon a consideration of whether directors have acted in the best interests of the corporation. This is not statutorily defined, and so the courts have taken to defining this essential obligation. The traditional approach dates back to 1883, associating the best interests of the corporation with those of shareholder wealth maximization. This approach is out-of- date. The judicial interpretation was appropriate in the late nineteenth century due to the economic, political, and social context within which the corporation was developing. Modern day corporations, however, have no relation to the corporate form of the late nineteenth century - today's businesses operate in dramatically different social, political, and economic environments. Accordingly, a redefinition of acting in the best interests of the corporation rightly acknowledges the interests of all corporate stakeholders, and properly suits the reality of the modern corporate form. Les notions de loi de corporation et de gouvernement de corporation souvent repos sur une consideration de si les directeurs ont agi dans les meilleurs int&r6ts du socijtg commerciale. Ceci n 'est pas defini dans les lois, et donc les tribunaux ont pris delfinir cette obligation essentielle. L'approche traditionnelle remonte & 1883, avec une association des intgr~ts meilleurs de la socigt commerciale avec ceux-l& de maximisation de richesse d'actionnaire. Cette approche est primg. L 'interprtation juridique 9tait correspondante dans le tardif dix-neuvi~me si&le grdce & le contexte 6conomique, politique et social dans qui la soci~t6 commerciale dveloppait. Les socijts commerciales modernes dejour, cependant, n 'ont pas de relation a laforme de corporation du tardif dix-neuvi~me sicle - les affaires d'aujourd'hui op~rent dans situations sociauz, politiques et environnements 9conomiques spectaculairement diffrents. En consequence, un redefinition de agir dans les meilleurs intrits de la socit9 commerciale bonment reconnait les intgr&ts de tous parieurs de corporation, et convenablement convient la r~alit de laforme de corporation moderne. Tuvia Borok is a graduating law student of Osgood Hall Law School. His academic and research interests surround corporate governance, corporate social responsibility, and the modem plight of the corporation within a global society. After completion of his studies, Tuvia will pursue his masters studies abroad, after which time he is scheduled to return to the firm of Oster, Hoskin & Harcourt LLP in Toronto, Canada. Vol. XV 113

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