Abstract
The State has always regulated the intra-firm communications that make corporate governance possible, most commonly by mandating disclosures of information by a corporation to its shareholders. Some such laws are labeled “securities regulation,” but securities regulation is a broad category that extends to speech by actors who are outside the corporate enterprise as well. Also, the conventional securities regulation category does not capture all such laws; other examples, including informationforcing mandates, can be found in state corporate law. This Article uses the term “corporate governance speech” to describe the communications among shareholders, directors, and officers through which corporate governance is accomplished. As a functional category, corporate governance speech serves vital private and public interests. Importantly, it is not commercial speech—notwithstanding the U.S. Securities and Exchange Commission (SEC)’s recent efforts to recharacterize its disclosure rules as commercial speech.
Recognizing corporate governance speech as a cohesive category leads to another conclusion: the corporation’s expressive interests cannot be burdened by laws regulating the internal communicative processes through which the corporation itself is constituted. This insight originates with Justice Lewis F. Powell Jr., one of the U.S. Supreme Court’s bestregarded experts on corporate law, who once defended the constitutionality of the SEC’s Shareholder Proposal Rule as regulation of “speech by a corporation to itself.” It follows from Justice Powell’s insight that parties challenging corporate disclosure mandates cannot establish any burden on the expressive rights of the corporation or its managers. Building on this insight, this Article shows how a streamlined form of First Amendment scrutiny could be applied to the regulation of corporate governance speech, including the disclosure mandates that are ubiquitous in securities regulation. The Article argues for a First Amendment approach to corporate governance speech that is sensitive to the democratic processes governing corporate organization, and to the democratic nature of informationally efficient markets.
Recommended Citation
Sarah C. Haan, Corporate Governance Speech, 48 SEATTLE U. L. REV. 343 (2025).
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