Democratising Corporate Governance: How to implement shareholder assemblies

Описание: For over half a century, the doctrine of shareholder primacy has offered a simple moral compass for corporate executives: make as much money as possible. Popularised by Milton Friedman in his seminal 1970 New York Times article, the theory posits that by maximising profits within the bounds of law and custom, companies maximise social welfare. If shareholders wish to save the whales or support the arts, Friedman argued, they should do so with their own dividends, not the company's ledger.

But does this division of labour still hold in a world of complex externalities? And in an era where voting power is increasingly concentrated in the hands of a few giant asset managers, whose preferences are being served?

In a recent discussion at London Business School, chaired by Professor Sergei Guriev, Dean of the School, three leading academics, Sir Oliver Hart, Hélène Landemore, and Luigi Zingales, presented a novel solution. Their proposal, detailed in a working paper by the three of them and a forthcoming book by Oliver and Luigi, Citizen Investors, challenges the conventional wisdom of corporate governance. They argue for the introduction of Investor Assemblies, deliberative bodies of randomly selected shareholders, to bridge the widening gap between what investors want and what companies do. The event was part of the Wheeler Institute Rethinking Capitalism series.

Subscribe to our YouTube channel ➤ https://bit.ly/3bukgoT
Visit our website ➤ https://bit.ly/3cl5b8m

Follow our social media accounts:
Twitter: https://bit.ly/3gGs1Kg
LinkedIn: https://bit.ly/2TyBfQY
Instagram: https://bit.ly/3cLK54D