Should stockholders be allowed to vote?

Author: IFLR Correspondent | Published: 23 Apr 2019

It is widely taken as a given that stockholder democracy is a good thing. If stockholders are the owners of corporations, they should have a way to express themselves, and democracy is by far the best way to enable a widely dispersed group of people to express themselves. But stockholders don’t really 'own’ a corporation, and it is not clear that letting them express themselves is always a good thing. 

At least since the mid-1930s, the predominant view has been that a corporation is owned by its stockholders and controlled by its managers (i.e., its directors and officers) as agents of the owners. For the last 50 years that has been coupled with the view that the principal objective of a corporation should be to maximise profits for its stockholders. However, neither of these may be correct. 

In a recent article, John Macey, a highly respected...