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> They are free to make whatever decisions they want, but are obligated by law to make decisions that benefit their investors. I'm unaware of any law which req
by kodah 6y ago
> They are free to make whatever decisions they want, but are obligated by law to make decisions that benefit their investors.
I'm unaware of any law which requires a business to make money for investors. A business can promise to pay dividends and they can speculate on where their stock can be at a future date, but there is no legal recourse if they lose money.
- finnthehuman 6y agoIt's a meme about the case Dodge vs Ford Motor, but all that case said was you can't actively screw your shareholders. Henry Ford had a cash surplus and was deliberately trying to avoid paying dividends to the Dodge brothers.
- kodah 6y agoOh, yeah that makes sense. TIL
- yazaddaruvala 6y agoThis might be useful: https://corpgov.law.harvard.edu/2019/08/24/stakeholder-governance-and-the-fiduciary-duties-of-directors/ https://corpgov.law.harvard.edu/2019/08/24/stakeholder-gover...