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There is no fiduciary duty to shareholders of a public company. This is known as the shareholder value myth -- myth because it is false.
by tanderson92 8y ago
There is no fiduciary duty to shareholders of a public company. This is known as the shareholder value myth -- myth because it is false.
- jessaustin 8y agoYeah if this were the case the private jet market would crater.
- adventured 8y agoBerkshire Hathaway could have never existed if it were actually a legal requirement. For decades they've constantly passed on doing things that could have easily juiced shareholder value, including hostile actions in regards to takeovers. It's why nearly all of their acquisitions come to them instead: an extraordinary reputation. Further, the fiduciary myth is silly as a premise upon any inspection: legally who gets to decide what's the one right ideal path for optimizing shareholder value, such that if you don't follow The One True Path then you're failing shareholders. Any other path than the single best one, would be inherently defined as failing the fiduciary responsibility to maximize shareholder value (which is another way of saying: legally it's an impossible concept to implement; and logically it's stupid, it falls down instantly, no person could know the maximization path at all times). It doesn't pass even a minute of rational intellectual scrutiny.
- tanderson92 8y agoFiduciaries are allowed to differ in their advice and action taken in that role. I know what you're saying but it's a bit subtler than that.