# kaal:claim:1558614-016

**Claim.** U.S. corporate law centers so heavily on shareholder manager conflicts of interest that, absent a demonstrable conflict, it treats risk taking as a situation where managers' and shareholders' interests are aligned and legal intervention is unwarranted.

**Type.** mechanism  **Support.** argued

**Holds when.**

- no demonstrable conflict of interest is shown

**Source quote.**

> Risk taking is one of those situations where U.S. corporate law assumes that managers' and shareholders' interests are aligned, or at least not sufficiently di- vergent that legal intervention is justified.

**From.** Painter and Kaal, *Initial Reflections on an Evolving Standard Constraints on Risk Taking by Directors and Officers in* (2010), III. Cultural Components of Risk Taking and Controlling Risk, page 22

**Cite as.** Painter and Kaal, Initial Reflections on an Evolving Standard Constraints on Risk Taking by Directors and Officers in (2010). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1558614

**Verify.** sha256 of source PDF `e898211630f4116879329d6de8397523dca5b066864147421aa5cbc7429dc83b` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Painter%20and%20Kaal%20-%202010%20-%20Initial%20Reflections%20on%20an%20Evolving%20Standard%20Constraints%20on%20Risk%20Taking%20by%20Directors%20and%20Officers%20in.pdf

**Topics.** risk-and-incentives

**Keywords.** conflict-of-interest, us-corporate-law, business-judgment-rule, excessive-risk

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