[O]ur corporations are no longer controlled by "persons" (i.e., individual shareholders). Some 70% of the shares of big publicly held corporations are held by "agents" -- the institutional investors who manage our mutual funds, pension funds, insurance and trust companies, and endowment funds.
These agents -- who together hold working control of Corporate America -- have all too often failed to honor their responsibilities of corporate stewardship, and they actively vote their proxies far too rarely. The record, as far as I know, is bereft of a single proxy proposal submitted by a mutual fund or pension fund investor in opposition to a corporation's management. The temptation for agents to take advantage of their agency position for their own benefit is too great. Large institutional investors, for instance, routinely manage the retirement plans and thrift plan portfolios of the very corporations whose shares they own. As the saying goes: "There are only two types of clients we do not want to offend: actual and potential."
Most institutional money managers today are owned by giant U.S. and global financial conglomerates with their own shareholders. Of America's 40 largest, 23 are owned by conglomerates, 8 are publicly held, and only 9 remain privately owned.
Whoever said class power can't be completely convoluted without being entirely straightforward?
3 comments:
Indeed, these pension funds should be administrated by independent funds that look solely after the interests of the later beneficiaries, IF the contributions are made by them (deducted from their payroll); however, if the fund is fnded by the employer directly, it is a different matter. So employees should try to arrange the contributions to come out of THEIR pay before one can expect fund managers to vote.
It reminds me of the passage in Lenin's Tomb by David Remnick. About how in the USSR the muckity mucks could be corupt but there was a proper way to go about it. Happily included in this large excerpt:
It seems that Kunayev's wife was jealous after learning that the wife of the Magadan Party secretary had been given as a gift an extremely expensive Japanese tea service. Magadan, a former labor camp center in the Far East, had unique access to Japanese goods, but Mrs. Kunayev would not be soothed. She had to have these cups and saucers. Party etiquette did not allow Kunayev simply to order the tea set from Japan or even Siberia. That was somehow too obvious. Even dispatching an aide to Tokyo was deemed unseemly.
"A way had to be found, of course," Vaksberg writes. "And such was its originality and refinement that it deserves its own little page in the history of the Soviet mafia."
(continues at link - the entire book is great)
Thanks -- good stuff.
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