Introduction—Corporate and Securities Law Responses to Climate Change: Law and Political Economy Perspectives

This introductory essay has two parts. First, we address differences between the Law and Economics perspective and the Law and Political Economy (LPE) perspective on business and securities law and climate change. For example, an LPE approach—with its concern for discerning winners and losers and how power operates through law—rejects the facile separation of public and private law concerns. LPE repudiates the common notion that business law is and should solely be about maximizing shareholder wealth, with all else falling to government ex post. Indeed, elsewhere we have written about this as a misleading and harmful “separate spheres” conceit (Stevelman and Haan 2020). To the contrary, businesses and their investors must and do incorporate climate risks into their basic forecasts and strategic analyses, melding public and private concerns. And recent legal changes to board committee service mean that directors are more active in leading this process—no longer content merely to limit agency costs. Hence, environmental matters, once thought of as the province of public law, are now essential features of corporate and securities law, as the scholarship herein demonstrates. Moreover, especially after Citizens United v. FEC, it is obvious that businesses themselves do not adhere to a separate spheres approach. Rather, they actively deploy their capital to shape political and legal outcomes to their advantage.

In the second section of this introduction, we survey the eight articles presented herein, addressing them, in pairs, as complementary treatments of core issues in this evolving field.