Robert A. G. Monks is asking some fundamental questions on his blog and, at least so far, is responding to comments. That’s a rare phenomenon in the blogosphere. I urge readers to get involved in this dialogue (The Appearance of Reality: Shareholders & Ownership):
The process by which directors are chosen is described as an election. And yet, virtually no one would describe the reality of how individuals accede to board membership as an election in the sense that word is generally understood by political scientists. Without pausing overlong to describe the actualities, it is at least clear that no individual appears on the company’s proxy statement for election to a vacancy except with the approval of the chief executive officer and the incumbent board members. It is equally clear that there are only as many individuals enumerated on the proxy card as there are vacancies.
All of this compels the conclusion that the election is a ritual without meaning in the corporate world. Why then do we insist on using a word that plainly does not describe what actually happens? This evokes the marvelous novels describing “double think” – 1984 and Brave New World –
“This was where “doublethink” came into play, minds were trained to hold Continue Reading →