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Still More On Suing The CEO For Social Activism

Last week, I devoted several posts to the question of suing the CEO for social activism.  The catalyst for the discussion was an August 17, 2017 Op-Ed piece by Jon L. Pritchett and Ed Tiryakian in The Wall Street Journal.  That piece cited recent CEO resignations from the White House's Council on Manufacturing and Target's adoption of an "inclusive" bathroom policy.  While neither of these involved corporate donations, readers might wonder whether CEOs could be sued for making gifts of corporate funds to social activist causes.

I addressed the legality of corporate giving three years ago.  However, that discussion focused on the corporation's power to make gifts.  Even when a corporation has the power to make a donation, a CEO might still be vulnerable.  A CEO's donation, for example, may have been unauthorized or even contrary to the board of director's instructions.  In some cases, it might be argued that the donation constituted a self-interested transaction in breach of the CEO's duty of loyalty.

When addressing CEO liability for social activism, it is important to remember that the shoe may be on the right or left foot.  Thus, those anxious to sue for left-wing social activism must be prepared to face the same arguments when the CEO is engaged in right-wing social activism.

Why August 24, 410 Is So Important To Western Civilization

Last week, I noted the anniversary of Alaric's sack of Rome in 410 C.E.  The event was notable for the Romans because it was the first time that their city had been sacked in centuries - the last instance of unauthorized barbarian entry occurred in the fourth century B.C.E.  The event, however, didn't mark the fall of the Roman Empire, however.  The Western Roman Empire would hang on for more than six decades and the Eastern Roman Empire for a millennium.  Alaric's unwelcomed visit, however, did mark the beginning of the end for the Western Empire.  The psychological impact, moreover, was profound, causing Eusebius Hieronymus (aka St. Jerome) to observe, "in una urbe, totus orbis interiit (in one city, the entire world was lost)".  More importantly, the sack of Rome incited Augustine of Hippo to attempt to explain the calamity by writing his magnum opus, De Civitate Dei (The City of God).

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Corporate Governance, corporate giving, Ed Tiryakian, Jon L. Pritchett, social activism, The City of God


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30172DBAB0084D3A8F39D7AF0A8E79BC.ashx Keith Paul Bishop
Partner at Allen Matkins
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