Corporate Adolescence: Why Did 'We' not Work?

Donald C. Langevoort, Hillary A. Sale
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引用次数: 1

Abstract

This article explores a series of rent-seeking behaviors and fiduciary deficits that are playing a role in the “growth” and demise of U.S. companies. Start-up financing occurs through exemptions that remove disclosure obligations required in public markets, assuming that private ordering suffices. The exemptive-privilege premise is that parties to financing rounds will be faithful agents, i.e., fiduciaries, to their sources of capital. Where there are conflicts of interest, fiduciary deficits will arise unless either the threat of litigation for breaches of duty sufficiently deters the resulting opportunism or the sources of capital are themselves sufficiently watchful and savvy to combat the opportunism. As private capital sources become more numerous and diverse, the latter may not happen so reliably. We examine this territory through a business-school like case study of WeWork, one of the most recent examples of failed private ordering and one where the prescribed corporate governance mechanisms failed to fill the gaps. WeWork’s extraordinary growth over eight rounds of financing both strengthened the hand of its CEO, Adam Neumann and concealed danger signs. Indeed, in the absence of required disclosure, fiduciary duties take on extra significance. Yet, the WeWork board exhibited multiple fiduciary deficits resulting in what is a cautionary story about governance failure and a warning to those who are focused on expanding “access” to these funding rounds In short, the funding and governance systems are not designed for long-term “startup” governance, and WeWork reveals the systemic slack and flaws. Our exploration of the motivations, incentives and opportunities in start-up financing reveals an accumulating set of deficits that makes the current state of affairs more problematic than the conventional account would suggest. From founder control enabling self-centered, biased and risky behaviors, to funders with diverse incentives and capital sources, to start-up market “valuations” issues, the result is failed information-forcing systems and governance safeguards and directors who focus on constituent protections and not on their fiduciary duties.
企业青春期:为什么“我们”不工作?
本文探讨了一系列寻租行为和信托赤字在美国公司的“成长”和消亡中所起的作用。假设私人订购就足够了,启动融资是通过取消公开市场所需的披露义务的豁免来实现的。豁免特权的前提是,融资各方将是其资本来源的忠实代理人,即受托人。在存在利益冲突的地方,除非违反义务的诉讼威胁足以阻止由此产生的机会主义,或者资本来源本身足够警惕和精明,以打击机会主义,否则就会出现信托赤字。随着私人资本来源变得越来越多和多样化,后者可能不会那么可靠地发生。我们通过一个类似商学院的WeWork案例研究来研究这一领域,这是最近一个私人订购失败的例子,也是一个规定的公司治理机制未能填补空白的例子。WeWork在8轮融资中取得的非凡增长,既增强了其首席执行官亚当•诺伊曼(Adam Neumann)的实力,也隐藏了危险迹象。事实上,在缺乏披露要求的情况下,受托责任显得格外重要。然而,WeWork董事会表现出了多重信托缺陷,导致了治理失败的警示故事,也给那些专注于扩大融资渠道的人敲响了警钟。简而言之,融资和治理系统不是为长期“创业”治理而设计的,WeWork暴露了系统的松弛和缺陷。我们对创业融资的动机、激励和机会的探索揭示了一系列不断累积的赤字,这些赤字使得当前的事态比传统的解释更有问题。从创始人控制导致自我中心、偏见和风险行为,到拥有多种激励和资金来源的出资人,再到初创企业市场“估值”问题,其结果是信息强制系统和治理保障措施失灵,董事们关注的是对股东的保护,而不是他们的受托责任。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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