Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Thursday, July 17, 2014

Park on Targeted Social Transparency Regimes

Stephen Park has posted Targeted Social Transparency as Global Corporate Strategy on SSRN with the following abstract:

Multinational enterprises (MNEs) are subject to a variety of U.S. laws that require public disclosure of their cross-border activities. Recent years have seen the emergence of mandatory disclosure regimes under U.S. federal securities law with the express purpose of advancing international human rights in the context of geographically-defined, issue-specific non-economic public policy objectives, which I collectively refer to as “targeted social transparency” (or “TST”) regimes. This Article addresses the appeal and shortcomings of mandatory disclosure as a means of regulating global corporate conduct, focusing on the unique challenges posed by TST. Two contemporary examples of TST are analyzed: (i) the “conflict minerals” provisions in the Dodd-Frank Act, which require the disclosure of minerals whose mining is associated with human rights violations in the Democratic Republic of Congo; and (ii) disclosure requirements under the Iran Threat Reduction and Syria Human Rights Act with respect to commercial activities associated with the Iranian government’s suppression of human rights. I present the concept of constructive discourse, which seeks to enhance the effectiveness of mandatory disclosure by addressing two related objectives: (a) how TST can catalyze internally-driven changes in corporate behavior to the mutual benefit of MNEs and stakeholders; and (b) how MNEs can use TST for strategic purposes. Using the concept of constructive discourse, this Article identifies and explores specific ways that TST regimes can shape socially-beneficial, strategically-rational corporate conduct.

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