Paulson’s piffle: “What’s in it for us?”
Two magazines on ethics and corporations, Ethisphere Magazine (on its blog, here) and Ethical Corporation (here), have earlier this month published articles on class actions in Europe and corporate governance in America, respectively. The Ethisphere blog post, as commented on there by yours truly, elaborates on “class action attorneys’ respon[se] to EU’s plea to sue companies ‘American Style’”.
The latter is far more interesting however, as it picks apart a statement on corporate governance and competitive corporations by US Secretary of the Treasury Henry M. Paulson. A quote:
Correcting lawyer misbehavior has no logical connection to my right as a shareholder or a consumer to seek compensation for corporate misfeasance that harmed me – financially or otherwise. By damning the victim’s agent, the Treasury Secretary gets to blame the innocent victim with impunity.
And the conclusion:
So [Paulson’s plan is to] loosen corporation regulation, at least on securities issues, and protect companies from punishing shareholder lawsuits. Then corporations will show that they’ve earned these privileges. It’s rewards first, performance later. […] What’s on offer, then, to shareholders and consumers is piffle in exchange for the right to protect themselves. That is Secretary Paulson’s “principles-based” play here.