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Theory of the firm

2018

Saint Louis University School of Law

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Shareholder Voting And The Symbolic Politics Of Corporation As Contract, Matthew T. Bodie, Grant M. Hayden Jan 2018

Shareholder Voting And The Symbolic Politics Of Corporation As Contract, Matthew T. Bodie, Grant M. Hayden

All Faculty Scholarship

American corporations are structured in such a way that shareholders, and shareholders alone, have the right to vote in all significant corporate decisions. Over the years, this exclusive shareholder franchise has been supported by an ongoing procession of justifications. But as those arguments have fallen by the wayside, shareholder primacists have circled back and latched upon a final argument for the special voting status of shareholders, arguing that this fundamental feature of corporate governance is the product of the set of freely-bargained-for agreements among all corporate constituents. Because this set of agreements reflects the preferences of all parties to the …