Corporate lawyers continue to grapple with the question of whether Delaware remains the prime destination for incorporation. While Delaware’s Senate Bill 21 moves through its legislative process, another significant piece of legislation is vying for attention. Texas Senate Bill 29, currently advancing in the Texan legislature, proposes key changes to the Business Organization Code. Notably, it seeks to enshrine the business judgment rule, which would provide legal cover for corporate leadership, assuming their decisions are made in a company’s best interest and in good faith.
This development could influence the landscape of corporate governance by potentially shifting some appeal away from Delaware, traditionally a hotspot for business incorporations. As companies assess their options, legal advisors are actively engaged in evaluating the implications of such legal changes and how they might affect incorporations beyond Delaware. More insights on this evolving discussion can be found here.