Steering Toward "True North": Canadian Corporate Law, Corporate Social Responsibility, and Creating Shared Value

Recent developments in Canadian company law are stirring the legal imagination by suggesting that corporate social responsibility ("CSR") could be integrated into mainstream governance frameworks. However, if such a transformative project is indeed underway, it remains incomplete. Landmark decisions from the Supreme Court of Canada have left more questions than answers concerning the fiduciary duties of directors. Commentators bemoan the lack of interpretive guidance from lawmakers on what it means to act in the "corporation's best interests", given the corporation's recasting as a "good corporate citizen". This article explores the cross-disciplinary potential of emerging business norms to provide such interpretive fodder. A variant of CSR, entitled "Creating Shared Value" (CSV), has had significant normative pull with companies, business academics, and policymakers alike. Emphasizing the social embeddedness of corporations, CSV suggests that a manager's core objective is to maximize "shared value" (rather than shareholder value) by developing strategies and operations based on loci of mutual interest between the company and its stakeholders. By presenting managers with a clear objective and guidelines for balancing competing interests, CSV addresses two significant flaws in the current formulation of the fiduciary duty. The CSV norm ought to be embodied within existing corporate governance legislation, thus completing a "feedback loop"business patterns will generate norms that breathe life into law so that law will have more instrumental vigour to regulate those business patterns. Ultimately, this could achieve more meaningful corporate sustainability patterns.