But the CEO doesn't own the company, the investors do, so why would the CEO be the one to state the goals leaving investors to "take it or leave it"?
I support your side of the argument, but why is it the case that finding a CEO is hard? It seems a bit like becoming president: there aren't many people in the pool who have matching previous experience anyway, and it's not even clear if "similar" experience even applies (Does one company resemble the other, even in the same industry? Different stages of growth, corporate structure, business model, region of operation etc), and much of the job seems to be adapting to new conditions. It seems more about the CEO's reputation and network, is that really just it? You pay for the CEO's access to the Old Boy's Club? Wouldn't the company be better served by spreading the role across multiple people, to avoid the stigma of changing CEOs?
I think this is why it is hard. Look at the people who ran for president in 2016. A lot of people want to be president, but most voters see, among a large pool, at most one person they think would fit the bill (and I think in the last election, a lot of people thought no one did). It's really hard to make a choice in such a situation. In the case of presidential elections, it's simply a matter of procedure that one person has to be selected on a specific day. Looking for a CEO? I'm sure the temptation to keep shopping when none of the candidates look ideal is very appealing.
The corporation has duties to its shareholders--it can't defraud them, for instance--but those duties are actually quite limited. In most cases the remedy for unhappy shareholders is just to sell their stock.
The CEO doesn't own the corporation either, but the CEO can direct the resources of the corporation. In any sort of operational sense, the CEO only reports to the board of directors, not to the shareholders entire.
For example Google has Class A - (GOOGL) and Class C - (GOOG)
The meat of the article:
If I own an object I can use it, or not use it, sell it, rent it, give it to others, throw it away and appeal to the police if a thief misappropriates it. And I must accept responsibility for its misuse and admit the right of my creditors to take a lien on it.
But shares give their holders no right of possession and no right of use. If shareholders go to the company premises, they will more likely than not be turned away.
They have no more right than other customers to the services of the business they “own”. The company’s actions are not their responsibility, and corporate assets cannot be used to satisfy their debts.
Shareholders do not have the right to manage the company in which they hold an interest, and even their right to appoint the people who do is largely theoretical. They are entitled only to such part of the income as the directors declare as dividends, and have no right to the proceeds of the sale of corporate assets — except in the event of the liquidation of the entire company, in which case they will get what is left; not much, as a rule.
Well, one point of the article is that these days 62% of CEO income is equity, so in most cases the CEO is also an "investor".
It does seem to me that creates a conflict of interest, in that a short-term plan to increase share price may not be in the long-term interests of the company. Yet, the CEO will likely not be around for the long haul and benefits more from short-term thinking.
I'm generally not a fan of Warren, but a good bit of this makes sense to me.
I think the most questionable part is: "At least 75% of directors and shareholders would need to approve before a corporation could make any political expenditures". That is just thrown in there with no explanation, and is likely intended to cripple Republicans by not allowing campaign contributions in almost all cases. That is likely the poison pill that will doom this legislation.