Public Law and Private Power：Corporate Governance Reform in the Age of Finance Capitalism

InPublicLawandPrivatePower,JohnW.Cioffiarguesthatthehighlypoliticizedreformofcorporategovernancelawhasreshapedpowerrelationswithinthepubliccorporationinfavoroffinancialinterests,contributedtotheprofoundcrisesofcontemporarycapitalism,anderodeditspoliticalfoundations.Analyzingtheoriginsofpro-shareholderandpro-financialmarketreformsintheUnitedStatesandGermanyduringthepasttwodecades,Cioffiunravelsadoubleparadox:theexpansionoflawandtheregulatorystateatthecoreofthefinanciallydrivenneoliberaleconomicmodelandthesurprisingroleofcenter-leftpartiesinchampioningtheinterestsofshareholdersandthefinancialsector.Sincetheearly1990s,changesinlawtoalterthestructureofthecorporationandfinancialmarkets—twoinstitutionalpillarsofmoderncapitalism—highlightthecontentiousregulatorypoliticsthatreshapedthelegalarchitectureofnationalcorporategovernanceregimesandthusthedistributionofpowerandwealthamongmanagers,investors,andlabor.Center-leftpartiesembracedreformsthatstrengthenedshareholderrightsaspartofastrategytocultivatethesupportofthefinancialsector,promotemarket-drivenfirm-leveleconomicadjustment,andappealtopopularoutrageoverrecurrentcorporatefinancialscandals.Thereformsplayedaroleinfosteringanincreasinglyunstablefinanciallydriveneconomicorder;theirimplicationintheglobalfinancialcrisisinturnposesathreattocenter-leftpartiesandthelegitimacyofcontemporaryfinancecapitalism.