Scholarship@WashULaw

Document Type

Article

Language

English (en)

Publication Date

1978

Publication Title

University of Dayton Law Review

Abstract

On April 28th of last year, the Securities and Exchange Commission announced it would begin a comprehensive reexamination of the shareholders' role in corporate governance. After receiving close to one hundred and fifty letters of comment, the Commission commenced hearings on September 29th in Washington D.C.

Few issues are so worthy of the Commission's concern. Under state corporation law, shareholders have the power to nominate and elect members of the board of directors. Today this power is virtually meaningless in publicly held corporations. The vast majority of shareholders vote by proxy. But neither state nor federal law guarantees shareholders access to the corporate proxy machinery. Instead, incumbent management is allowed to use corporate funds to solicit proxies on their own behalf while all other shareholders must pay for proxy solicitations for their nominees out of their own pockets. The result is that only incumbent management can afford to make nominations.

Keywords

Corporate Democracy, Shareholders' Role in Corporate Governance, SEC, Proxy Voting

Publication Citation

Joel Seligman, The Securities and Exchange Commission and Corporate Democracy., 3 U. Dayton L. Rev. 1 (1978)

Download

Share

COinS