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True, but we are not talking about a two man company or a historic trust fund in southern France. We talk about an US shareholder company which leadership (do n

by oaiey 4y ago

True, but we are not talking about a two man company or a historic trust fund in southern France. We talk about an US shareholder company which leadership (do not be nitpicky) can be sued for by shareholders by not doing the best for their money. And law indeed differs... But everywhere someone will be made responsible for not getting the best for their buck (the simplest case: being fired). That applies to FAANGMxyz and also the rest of the top 500 shareholder companies.

alxlaz 4y ago
I was under the impression (based on the USSC's opinion back in 2015, see e.g. https://www.nytimes.com/roomfordebate/2015/04/16/what-are-corporations-obligations-to-shareholders/corporations-dont-have-to-maximize-profits https://www.nytimes.com/roomfordebate/2015/04/16/what-are-co... ) that this was not true even in the US. Has anything changed in the meantime? Or did I get that article wrong from the beginning?
- deleted 4y ago
  [deleted]
- Conan_Kudo 4y ago
  It is not true in the United States. Officers of the company are required to do best by the company and all stakeholders, but the officers can generally define how they approach that. Most go by the share price, because it's used as a proxy to measure company success.
Someone 4y ago
But “the best for their money” need not be short-term. Shareholders have successfully sued big oil for not preparing enough for climate change, for example. (https://www.cnbc.com/2022/03/15/oil-shell-directors-sued-for-failing-to-prepare-for-energy-transition.html https://www.cnbc.com/2022/03/15/oil-shell-directors-sued-for..., https://www.forbes.com/sites/timabansal/2021/05/27/big-oil-under-fire-climate-activists-win-big-against-exxon-and-shell/?sh=661f3e11118c https://www.forbes.com/sites/timabansal/2021/05/27/big-oil-u...) It will be a lot harder to argue that developing a closed-source component is, in the long run, bad for Microsoft, though.

by oaiey 4y ago

alxlaz 4y ago

I was under the impression (based on the USSC's opinion back in 2015, see e.g. https://www.nytimes.com/roomfordebate/2015/04/16/what-are-corporations-obligations-to-shareholders/corporations-dont-have-to-maximize-profits https://www.nytimes.com/roomfordebate/2015/04/16/what-are-co... ) that this was not true even in the US. Has anything changed in the meantime? Or did I get that article wrong from the beginning?

deleted 4y ago
[deleted]
Conan_Kudo 4y ago
It is not true in the United States. Officers of the company are required to do best by the company and all stakeholders, but the officers can generally define how they approach that. Most go by the share price, because it's used as a proxy to measure company success.

Someone 4y ago

But “the best for their money” need not be short-term. Shareholders have successfully sued big oil for not preparing enough for climate change, for example. (https://www.cnbc.com/2022/03/15/oil-shell-directors-sued-for-failing-to-prepare-for-energy-transition.html https://www.cnbc.com/2022/03/15/oil-shell-directors-sued-for..., https://www.forbes.com/sites/timabansal/2021/05/27/big-oil-under-fire-climate-activists-win-big-against-exxon-and-shell/?sh=661f3e11118c https://www.forbes.com/sites/timabansal/2021/05/27/big-oil-u...) It will be a lot harder to argue that developing a closed-source component is, in the long run, bad for Microsoft, though.