Volume 40 Number 2

Corporations and Human Life

In Part I, I address decision-making. How should risk to human life be included in the jurisprudence of corporate decision-making? In terms of finance, how should corporations make net present value decisions when risk to human life is a factor? In terms of law, is there a case for exceptions to the business judgment rule based on risk to human life?

Second, in Part II, I address oversight. How should risk to human life be included in the jurisprudence of oversight? In terms of finance, how should corporations approach risk management when human life is a factor? In terms of law, is there a case for different treatment of corporate oversight of risk to human life?

My tentative answer is that corporate boards should explicitly address risk to human life in both decisions and oversight, and judges in corporate law cases should apply a heightened standard of scrutiny in cases when boards have not done so. In addition, with respect to corporate decisions and oversight related to risks to human life, policy makers should consider moving away from the traditional external governance associated with regulation and tort liability in favor of internal corporate governance.

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