Re:Google shifted $23 bln to tax haven Bermuda in 2017
by GreeniFi on Saturday January 05, 2019 @08:40AM
(#18831570)
Can you differentiate acting in the best interest of the company to maximaing return to shareholders, when that is the very raison d'être of a company?
Re:Google shifted $23 bln to tax haven Bermuda in 2017
by sokoloff on Saturday January 05, 2019 @08:44AM
(#18831583)
[In most states] Companies may be formed for any lawful purpose; maximizing returns to shareholders does not need to be the primary purpose (nor necessarily a purpose at all, the extreme example of which are charities). IOW, it could be the raison d'être of a particular company, but is not necessarily so.
Read the Hobby Lobby case as a start.
Quote from Justice Alito in that opinion: While it is certainly true that a central objective of for-profit corporations is to make money, modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not do so. . . If for-profit corporations may pursue such worthy objectives, there is no apparent reason why they may not further religious objectives as well.
They can be sued for anything, just like anyone, but there is a large body of corporate case law supporting the use of business judgment to achieve goals other than short-term maximization and typically have E&O coverage as well to provide some coverage for nuisance lawsuits and cases other than personal misconduct or conflicts of interest. So, sue away, but you almost surely won’t win if the board pursued a lawful strategy other than the one you as a shareholder prefered.