Matt Levine's take (sorry Matt for the long excerpt): https://www.bloomberg.com/opinion/articles/2019-08-19/we-looks-out-for-our-selves https://www.bloomberg.c

Matt Levine's take (sorry Matt for the long excerpt): https://www.bloomberg.com/opinion/articles/2019-08-19/we-looks-out-for-our-selves https://www.bloomberg.com/opinion/articles/2019-08-19/we-loo... The managers and the board, in this version of the corporation, are the only ones representing all of the constituencies, so they are the only ones qualified to evaluate their own performance. If an activist shareholder comes in and says “we should replace the board because performance is bad,” the board and the CEO can respond “no you are just saying that as a greedy shareholder and we shouldn’t listen to you.” Another way to put it is that the corporation really does have to serve many different stakeholders, but in practice most disputes over corporate governance are not between shareholders and employees or shareholders and polluted watersheds, but between shareholders and managers. And these disputes tend to follow a stereotyped pattern in which disgruntled shareholders say “the stock price is low” and the managers say “ah but in the long term it will be high.” Because—on the agency-cost view—it is just harder to measure the long term (since it hasn’t happened yet), so you can’t hold the managers to it. Similarly, if managers can respond “ah but the stock price is low because we are serving other constituencies,” that gives them another argument against the shareholders. ... So when an association of big public-company CEOs gets together and declares that corporations should serve the community, take care of the environment, and be responsible to employees and customers, not just shareholders, that might be because the CEOs have thought it over and decided that employees and the environment are getting a raw deal, but it is also possible that the CEOs have thought it over and decided that shareholders are annoying.