Research Handbooks in Corporate Law and Governance series
Edited by Jennifer G. Hill and Randall S. Thomas
Chapter 10: Conceiving corporate commitment: creation and confirmation
Commit: To give to someone to take care of, keep, or deal with; to give in charge or trust, entrust, consign to (a person, his care, judgement, etc.) from Latin committ_re to put together, join, also (com-intensive) to put for safety, give in charge, entrust, deliver. (Oxford English Dictionary Online). There are a number of striking features of the above definition of commitment. First, it encapsulates the notion of giving or entrusting something or someone to the care of others. Second, there are no contracts or incentives associated with the act of giving but there are obligations and responsibilities thereby arising. Third, the recipient is obliged to look after that which is entrusted to them and to ensure it is held and employed wisely in the interests of the other party. It is not a concept with which economists feel comfortable. There are no contracts or incentives to ensure good performance. There are not even repeat relations to discourage default. There is just trust that the recipient will not abuse their position.
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