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Wasn't there that Michigan Supreme Court decision that states that was precisely the purpose of a company -- to maximize shareholder value?
by dorchadas 7y ago
Wasn't there that Michigan Supreme Court decision that states that was precisely the purpose of a company -- to maximize shareholder value?
- EliRivers 7y agoYou're thinking of https://en.wikipedia.org/wiki/Dodge_v._Ford_Motor_Co https://en.wikipedia.org/wiki/Dodge_v._Ford_Motor_Co. , which was literally a century ago. If you scroll down to "Significance", you can read for yourself that it's by no means universally accepted ("that this interpretation has not represented the law in most states for some time"). Let's come forwards a little; as the U.S. Supreme Court recently stated, "modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not do so." Where this is basically going is that the common belief - that there is some clear, absolute law that totally says the shareholders are the owners and the company is all about giving money to them - simply isn't true.
- dorchadas 7y agoThank you! I just remember reading about it before, but didn't know much more. Thanks for the info, and definitely glad that's changed!