Ernest Lim (National University of Singapore) will give a lecture at the Amsterdam Center for Transformative Private Law as part of the Values of Private Law lecture series titled, Fiduciary Duties, Climate Change, and the External Dimension: Lessons from State-Owned Enterprises.

Lim analyses whether directors are required to consider the economic, environmental, and climate impacts of a company’s operations, even when these considerations do not directly benefit firm-specific shareholders financially. He contrasts this ‘external dimension’ of directors’ duties with the traditional focus on maximizing shareholder value, identifying the rise of diversified investors, the EU’s sustainability regulations, and the significant emissions from state-owned enterprises (SOEs) as key factors driving the push for a broader perspective.

Lim examines and ultimately rejects the effectiveness of incorporating environmental-related provisions into corporate constitutions or relying on directors to act on shareholder preferences as sufficient means to address external impacts. He argues that these approaches often remain constrained by the principle of shareholder primacy. Instead, he proposes that SOEs in countries such as China, the Nordic nations, and certain Western European states offer a compelling case study. In these enterprises, the state functions both as a controlling shareholder and a diversified asset owner. According to Lim, this dual role supports the view that directors should take into account broader economic and environmental impacts. Doing so, he contends, aligns directors’ fiduciary duties with the state’s responsibilities as both controller and asset owner, offering valuable insights for broader corporate governance debates.