> Oddly, no previous management research has looked at what the legal literature says about the topic, so we conducted a systematic analysis of a century’s worth of legal theory and precedent. It turns out that the law provides a surprisingly clear answer: Shareholders do not own the corporation, which is an autonomous legal person. What’s more, when directors go against shareholder wishes—even when a loss in value is documented—courts side with directors the vast majority of the time.
The problem with this saying that "courts side with directors the vast majority of the time" is that it ignores which parties are involved in the lawsuits. In most cases, the suit is a class-action brought against the corporation by disgruntled current or former shareholders; employees are not parties to the suit. In this case, the petitioners are seeking restitution which will come out of the pockets of the current shareholders, as the corporation may be forced to pay them, thereby reducing the corporation's assets and total value.[1] If you are interested in this issue, you should read up on "Halliburton v. Erica P. John Fund", which has been argued this Supreme Court term and not yet decided; many interesting arguments are contained in the various briefs.[2]
Right. "Ownership" is a really fuzzy thing; in the context of owning shares of a public corporation it gives you the right to be treated equally (in some senses) with other shareholders, standing for shareholder lawsuits alleging breach of fiduciary duty, and most importantly the right to select the board and vote on certain proposals.
No voting rights takes away the most important component.
It has not been shown that voting is the most important and effective means of maintaining accountability. There is a long-standing debate as to whether voice (voting) or exit (the ability to exit a long position) is more important.[1]
It should be noted that Apple doesn't have this "minority shareholders are sheep with no say" structure and thus was quite open to pressure from them(Icahn et al).
Personally, I am all for activist shareholders in a public company and proxy fights. Google and Facebook are heading down a path to stagnation at some point. What then?
http://hbr.org/2010/04/the-myth-of-shareholder-capitalism/ar...