Implications for Corporate Governance and Regulation
Corporate Law
1. Weakened Board Oversight: Boards of directors may not be as pressured to put investors’ interests and moral behavior first in the absence of regulations. Increased risk-taking and the possibility of business scandals might result from this.
2. Decreased Transparency: If corporations’ disclosure obligations loosen up, it will be more difficult for the public and investors to evaluate the financial standing and business operations of the company.
3. Change in Power Dynamics: There may be less shareholder influence on corporate decision-making, which might give management greater power and less responsibility.
Regulations
1. Deregulation: Deregulatory measures include the relaxation or repeal of several current laws pertaining to consumer protection, labor safety, and environmental preservation. The environment, public health, and safety may suffer as a result of this.
2. Diminished Consumer Protections: Legislation protecting customers from deceptive or fraudulent acts may be undermined.
3. Limited Antitrust Enforcement: Lower restrictions on monopolies and anti-competitive behavior may result in increased costs and fewer options for consumers.