Delaware has long set the standard for corporate law. As of 2023, more than two million business entities, 68% of Fortune 500 companies, and nearly 80% of U.S. IPOs were registered here. These numbers reflect decades of collaboration between the public and private sectors.
Our state’s success cannot be taken for granted. In 2021, Delaware saw more than 336,000 new business formations by 2023, that number had dropped below 298,000. At the same time, through the stewardship of the Delaware Division of Corporations, the corporate franchise contributions to the state’s annual budget increased from $1.6 billion to more than $2 billion. While this is a positive trend, it means that the state is now even more dependent on this revenue source.
Delaware’s corporate law legacy began in 1899 with the creation of the General Corporation Law, which transformed the state into the preferred home for corporations, overburdening businesses. For 125 years, CSC has worked alongside the State of Delaware to create and preserve an ecosystem where businesses can thrive, people can grow, and communities can prosper.
But our great state’s benefits—efficient flow of capital, robust case law precedent, and developed expertise—can become vulnerabilities if other jurisdictions offer these same advantages in a more compelling way. To ensure Delaware remains the leader, we must defend and enhance our strengths.
Here in the U.S., Nevada and Wyoming have been perennial competitors. Texas recently launched its Business Court, modeled on Delaware’s own Court of Chancery.
Around the world, other jurisdictions are sharpening their competitive edges: Ireland boasts favorable rules for intellectual property; Luxembourg offers unparalleled protection for investors and fund managers; the Cayman Islands is now a leading jurisdiction for private capital investment and the fourth-largest holder of U.S. Treasuries. Each of these jurisdictions highlights the need for Delaware to keep evolving.
The regulatory landscape that businesses operate within is rapidly transforming, and Delaware is not immune to these changes. In fact, our positions as the leader in corporate law places us in the crosshairs of domestic and international scrutiny.
The Corporate Transparency Act introduced significant new reporting requirements for businesses. International bodies are setting the tone for global regulation The EU’s creation of the Authority for Anti-Money Laundering and Countering the Financing of Terrorism represents an additional layer of oversight. A single misstep in implementing regulations or responding to global standards could tarnish Delaware’s position as a global leader, with long-standing repercussions.
The path forward requires collaboration and consensus. Delaware’s strength has always been its ability to grow without losing sight of its core principles: predictability, fairness, and adaptability.
The corporate franchise represents more than one-third of the state’s total revenue, which supports essential services, from education to infrastructure to workforce development and housing needs, while enabling Delaware to remain one of the few states without a sales tax. This success benefits everyone in the state, from small-business owners to homeowners who enjoy some of the lowest property taxes in the region. Protecting this legacy is not just a business priority—it is a responsibility that touches every citizen of the First State.
The cornerstone of our franchise is our judicial system. We must continue to recruit, support, and compensate our courts to attract the highest-quality judiciary and staff possible. This starts with a selection process that continues to prioritize legal acumen, competency, and depth of experience above all else, while remaining mindful of geographic, political and broader diversity goals that will always be important. And our legislative and executive branches must ensure that the courts remain appropriately resourced and funded in perpetuity.
Divisions—whether political institutional or ideological—undermine progress. The Delaware Prosperity Partnership serves as a model for how public/private partnerships can drive our collective success. We should double down on this effort and seek other opportunities to replicate this recipe for success.
Collectively, we can work together to create an environment where businesses can continue to innovate responsibly and ensure Delaware remains not just a leader in corporate governance, but an international symbol of innovation, stability, and opportunity. And we can look forward knowing that we have passed on to future Delawareans a franchise that remains second to none.
Rod Ward is the President and CEO of CSC.