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Why Shareholders Shouldn't Vote: A M arxist‐progressive Critique of Shareholder Empowerment
Author(s) -
Talbot Lorraine
Publication year - 2013
Publication title -
the modern law review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.37
H-Index - 22
eISSN - 1468-2230
pISSN - 0026-7961
DOI - 10.1111/1468-2230.12036
Subject(s) - shareholder , corporate governance , market liquidity , status quo , empowerment , marxist philosophy , politics , capital (architecture) , shareholder resolution , shareholder value , law and economics , value (mathematics) , economics , business , political economy , market economy , accounting , law , finance , political science , economic growth , archaeology , history , machine learning , computer science
This paper argues that liquidity, short‐termism and low involvement in corporate governance are fundamental ingredients of shareholders’ value maximisation strategies. Neither shareholders nor their representatives will voluntarily adopt restrictions which inhibit their ability to pursue these strategies, such as those presented by the S tewardship C odes. Utilising M arxist and progressive theory this paper evidences the tendency for all capital (including shares) to seek liquidity. It presents historical evidence which shows that political policy can either restrict this tendency, as it did in the progressive and post war period, or facilitate it, as it did in nineteenth century E ngland and in the current neoliberal period. The shareholder empowerment initiatives examined in this paper are therefore best understood as strategies to justify shareholder claims in the current crisis and to thereby protect the neoliberal status quo.