04 January 2016

The Apologist Case Against Shareholder Democracy

The case against allowing significant shareholders of a publicly held corporation to nominate candidates to the board of directors is truly unimpressive.  For example, it isn't the way it has been done traditionally, directors who are defeated might get their feelings hurt, and boards of directors might come to believe that they are accountable to shareholders.


Unsurprisingly, the main supporters of the current regime are incumbent board of directors members and the main supporters of change are institutional investors (hardly a rabble rousing crowd of Marxists).

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