In this chapter, I analyse the main trade-offs between the economic value of the firm and its social value, exploring how they are solved through corporate governance and regulatory constraints. To begin with, I show how firms generate social value while also increasing their long-term value under the enlightened shareholder value approach. Thanks to organizational and technological innovation, firms are led to change their business models and organization to enhance environmental and social sustainability and increase long-term profitability. In addition, managers promote their firms’ sustainability in compliance with ethical standards which are part of corporate culture. In similar situations, generating social value may determine pure costs to the enterprise. I argue therefore that the perspective of instrumental stakeholderism appears too narrow, for situations exist where non-economic values are also relevant to the firm. The importance of ethics is especially underlined by CSR and stakeholder theory. Moreover, management studies emphasize the role of corporate governance and organizational theory in the promotion of social value. The board of directors should identify the ethical and cultural values of the firm and monitor their application at all levels. In addition, organizational purpose plays a fundamental role for the ‘intrinsic’ motivation of people in corporations. The international soft law on corporate due diligence further contributes to the design of corporate purpose and to the motivation of managers and employees. Once corporate due diligence is recognized by European hard law through the proposed Directive, specific obligations will arise for companies which will impact their governance and could become a source of civil liability. As a result, the corporate purpose orientation to sustainability will be reinforced by the regulation of environmental and human rights externalities and by the due diligence obligations deriving from it.

Sunita Malepati’s commentary describes how number of minority shareholders brought suit against a family-owned supermarket, Market Basket, with a history of treating employees and other stakeholders well. A group of minority shareholders had offered to sell their shares to a third party, and CEO Arthur T. Demoulas resisted, arguing that the shareholders could not sell their stock if it would imperil the corporation’s tax status. The original opinion found that the shareholders could sell their shares to whom they pleased, regardless of how it might impact the corporation. The feminist judgment rejects the original opinion, applying a feminist ethic-of-care lens and embracing a feminist-informed stakeholder theory of corporate governance. Rather than replicating the shareholder primacy model’s privileging of shareholder-owners, the feminist judgment vindicates the interests of the corporation’s employee-stakeholders and community the corporation serves—each ethnically and socioeconomically diverse groups.

In Canadian corporate law, shareholders occupy a preferential role vis-à-vis other stakeholders. Shareholders are the only stakeholder with statutory rights, such as the right to elect and remove directors. Against this backdrop, this chapter examines the Canadian corporate governance landscape from the perspective of shareholders and examines the legal and market tools that shareholders have available to them. This chapter also explores the limitations and effectiveness of these mechanisms and considers various market actors who influence shareholder behaviour and can facilitate shareholder engagement. The chapter concludes with an analysis of three trends in shareholder engagement in Canada: (i) institutional investor engagement on issues at the core of ESG; (ii) the role of proxy advisory firms and the influence they wield over institutional shareholders; and (iii) the immediate  impact of COVID-19 on shareholder engagement.