USA Trends and Developments Contributed by: Piotr Korzynski, Mark Mandel, Michael Pilo and Carol Stubblefield, Baker McKenzie
Prepare during the quiet period For companies, the governance takeaway is that the best activism defence is still preparation during “quiet” periods. Boards should not wait for an activist approach to test the coherence of their capital alloca - tion strategy, CEO succession plan, board composi - tion or shareholder engagement programme. In the current environment, an activist campaign is less likely to be a surprise attack by a single high-profile fund and more likely to be the culmination of concerns that institutional investors already share, even if expressed less aggressively. Delaware, Texas and Nevada Are Now Offering Genuinely Different Governance Paradigms A central governance story of the past year has been the intensifying competition between Delaware, Tex - as and Nevada. For many years, state of incorpora - tion was treated as an important but relatively stable background choice for public companies. While early incorporation data amid the DExit debate continues to suggest that Delaware remains the incorporation jurisdiction of choice, the discussion and reconsidera - tion of that choice have become more prominent and serious over the last year in particular. Recent statu - tory reforms in all three states mean that incorporation strategy is becoming a more active governance issue, especially for companies with significant or controlling individual shareholders. Delaware: preserving primacy through recalibration Delaware’s 2025 corporate legislative reforms, par - ticularly Senate Bill 21, were a direct effort to preserve Delaware’s central role while responding to concerns that case law and litigation patterns had become too unpredictable or plaintiff-friendly. The amendments established or clarified safe harbour procedures for conflicted transactions, codified aspects of controller- transaction review, strengthened presumptions tied to exchange-based independence standards and nar - rowed stockholder inspection rights under Section 220. Delaware’s message was not that it would cease to be a state that applies corporate fiduciary duties through common law, but that it would try to restore greater predictability and, through more targeted leg - islation, reduce the incentive for companies to leave.
That said, Delaware’s model remains meaningfully dif - ferent from its competitors. It still offers the deepest case law, the Court of Chancery’s institutional sophis - tication and the market’s longest-established trans - actional infrastructure. For many public companies, those features remain powerful reasons to stay. But Delaware’s reforms also tacitly acknowledge that it is now competing more overtly on litigation economics and governance certainty than it had to in the past. Texas: a governance model built around business judgement and forum engineering Texas has moved quickly to position itself as a seri - ous alternative. Building on the new Texas Business Court, Texas enacted reforms that codify the busi - ness judgement rule, permit exclusive Texas forum provisions and jury trial waivers for internal claims, narrow books-and-records rights and allow public corporations to impose ownership thresholds for some derivative and proposal-related activity. Texas also introduced a novel mechanism for obtaining a judicial determination of special-committee independ - ence in advance. Texas’s appeal is therefore not just geographic or political; it is increasingly substantive. Its model is attractive to companies that want a more statutory and board-protective framework, a business court designed for commercial disputes, and greater ability to shape the litigation environment through govern - ing documents. At the same time, some of the more aggressive Texas reforms – especially those that inter - sect with federal proxy rights – may invite pre-emption or other judicial challenges, which means the practical contours of the Texas model are still developing. Nevada: the most protective model for controllers and fiduciaries Nevada’s recent reforms reflect an even more overtly protective approach for controlling stockholders and fiduciaries. Nevada has clarified the very limited cir - cumstances in which controlling stockholders may owe fiduciary duties, permitted jury trial waivers for internal actions, reinforced statutory protections for directors and officers, and moved toward a more structured and limited litigation framework. It is also considering a specialised business court, which
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