In 1830, Governor Levi Lincoln, Massachusetts Jr. urged the state legislature to introduce adopted limited liability regime for manufacturing companies similar to neighboring states a company. At least since 1809, the shareholders in the state of manufacturing corporations had unlimited liability, the general partners of corporate debt instead of facing. While meant unlimited financial prudence, Lincoln and others were concerned that these policies provide more harm t … Read more »

In 1830, Governor Levi Lincoln, Massachusetts Jr. urged the state legislature to introduce adopted limited liability regime for manufacturing companies similar to neighboring states a company. At least since 1809, the shareholders in the state of manufacturing corporations had unlimited liability, the general partners of corporate debt instead of facing. While meant unlimited financial prudence, Lincoln and others were concerned that these policies do more harm than good and to ensure driving capital of the state. With the governor pushing for action, it was up to Parliament to decide how to proceed.
«Hide

from
David A. Moss,
Eugene Kintgen
Source: HBS
18 pages.
Publication Date: Dec 20, 2007. Prod #: 708016-PDF-ENG
Rulers of the modern enterprise: The debate over limited liability in Massachusetts HBR case solution