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Models of shareholder democracy: A transnational approach

Published online by Cambridge University Press:  14 November 2018

ABRAHAM SINGER  and
AMIT RON
ABRAHAM SINGER*
Affiliation:
Department of Management, Quinlan School of Business, Loyola University Chicago, 820 North Michigan Avenue, Chicago, IL 60611
AMIT RON*
Affiliation:
School of Social and Behavioral Sciences, Arizona State University, West Campus, 4701 W Thunderbird Road, Glendale, AZ 85306
*
*Email: asinger2@luc.edu
†Email: amit.ron@asu.edu
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Abstract:

Existing discussions about shareholder control work with a state-centric and Westphalian conception of democracy. Therefore, they see the corporation as a state-analogue: shareholders (citizens) elect a board (legislature) charged with the responsibility to ensure that the executive follows their ‘collective interest’. We claim that state-centric models of democracy are not apt for an environment of corporate governance characterised by complex interdependence, porous boundaries, and criss-crossing relations of weak allegiances. Instead, we suggest that recent theories of transnational democracy provide us with better models for thinking about ‘popular’ control in such an environment. We look at shareholder democracy not as a system where a single body representing a ‘demos’ tries to control a single executive; instead, we view shareholders as constituting multiple dêmoi which must coordinate and collaborate to control multiple corporate executives. We emphasise deliberation and communicative power as a central mechanism for these dêmoi of shareholders to effectuate control.

Keywords

corporate governancedeliberative democracypension fundsshareholder democracytransnational democracy
Type
Research Article
Information
Global Constitutionalism , Volume 7 , Issue 3 , November 2018 , pp. 422 - 446
Copyright
Copyright © Cambridge University Press 2018 

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