I was scheduled to give a speech at the RFK Compass event in Cape Cod this week but unfornately I cannot attend. Here’s the speech I prepared on the state of corporate governance.
What is an owner? And, what is an owner of a publicly traded corporation? It’s clear that they are not the same thing. We don’t own a corporation like we own a car or property. Even individual owners of corporate stock don’t really “own” the corporations. We have neither the rights nor responsibilities commonly associated with the term ownership.
Busy time in London: Spoke yesterday at the Responsible Investor conference, speaking at CSFI, Institute of Directors and Investor Forum next week. Many, many superb people here and I’m enjoying the chance to catch up with old friends.
Getting worldwide ownership to cooperate on an issue might seem like an effort in herding cats: everyone is going to do their own thing. The thing is, nobody is really doing their own thing. What we have is an uncoordinated body of ownership that blindly follows management.
A corporation is the creature of the state. There is no such thing as corporate Common Law. Each of the earliest corporations was literally created by specific statute, a condition which has been diluted over the last four centuries. The original social contract that made creation of corporations attractive was explicit: what business, what term, what invested capital. These corporations were created to serve human interests and they were tied inextricably to the interests of society.
What we have in our current state of Corporate Governance is Kabuki Theater.
The American Economy is a corporate system, in the sense that control of the economic factors of production and distribute is vested largely in the handful of privately appointed corporate managers.
As I read in the Crimson “Divest Harvard Plans Weeklong Blockade of Massachusetts Hall,” I had to ask myself: why I am not participating? Why not me?