Intel shareholders can now vote to ensure Intel takes a stand against China, if they choose. But it seems those individuals do not want that. So Intel is doing what it is supposed to do -- operate in accordance with wishes of the shareholders.
A company is a group of people coming together for a purpose. Management can't destory the group in pursuit of their own values. A ship's captain can't risk the ship because of their own values.
They haven't even asked what the shareholders want. They don't think they need to, because they believe that everyone will naturally share their belief that money is their highest priority.
They have a duty to act in the best interest of the shareholder. Generally that means not having reduced revenue. This is what most people accept. If shareholders want them to do something different they can let them know.
I think this is the fundamental disagreement we have, and it's probably too big of a conversation for a comment thread. In my philosophy of determining "best interest", revenue is an important consideration, but not the only one and not the most important one. There is certainly no legal duty to increase revenue or stock price or anything like that.
Under which law? Plenty of corporate boards do things their shareholders don't like every day.
Having said that, someone at Intel, owners or managers, are way off track here and in need of severe consequences. They picked the wrong side.
And a court isn't going to second-guess the management if they judge the cost savings of using slave labour don't outweigh the potential for reputational damage.
As such, management are free to act either way.
I strongly believe we need more voter participation here.
There's such a thing as activist investors, and they seem to be gaining influence lately. From what I read in the newspaper, they're behind a lot of the changes that are starting to happen at certain multi-national oil companies.
I think there should be far more shareholder involvement in general. We are far too acquiescent as a group.
If you polled every direct and indirect INTC holder (you may be one, unknowingly) about slavery and concentration camps, you’d walk away with a near 100% mandate for taking all measures against it.
It's not a one-way street.
Management can do things, and if the shareholders don't like it, they can sell their shares in protest.
Happens all the time.
Too early to conclude this. These tensions present not only a reputational risk for Intel, but financial ones as well, particularly if tensions escalate. Managers might not care, but there is precedence for shareholders taking a longer view [1].
[1] https://www.nytimes.com/2021/06/09/business/exxon-mobil-engi...
Management absolutely has a say.
Good question, who are Intel shareholders?
Generally these people barely know they're shareholders, they receive none of the paperwork needed to vote at the AGM, they have a slice several orders of magnitude too small to exert any influence, and they have no way of identifying or contacting other shareholders to take any sort of coordinated action.
Anyone who expects X to be done by shareholders is going to be disappointed.
It's the general problem of public ownership of means of production.
Public companies don't work. Stock market provides heck a lot of wrong incentives.
https://www.nasdaq.com/market-activity/stocks/intc/instituti...
Fun in theory but too bad only Americans tolerate those PE multiples. So, look out below!
If no one wants to do that then what is all these kvetch about "capitalism" and "greed" corrupting companies and our values when it is the people who do not care. Certainly not enough to pay up for the shares.
in my case I was waiting for disgruntled shareholders to sell because an aggregate stance was not taken by management or other shareholders, and then when sold it goes to people more or less apathetic.
in your case you want people to buy the shares at any price but likely a premium, in order to exercise a goal, which I frankly think is absurd.
so guess the market has priced everything in well enough, as an aggregate opinion on its own.
If the American consumers of Intel chips -- the people and government actors -- are unhappy with Intel's stance then they can also not buy their chips. This is basically what the Chinese are doing (without owning shares). Now granted the Chinese people have little say in it but the government is ostencibly acting on their behalf. Even if China was a democractic country and the CCP could not ban Intel outright then the government or the people could say that they would not buy Intel chips.
So if Americans did the same to uphold their own belifes then Intel would suffer here and that would reduce the stock price, which would make it easier for people who want to take them to take the progressive position to buy the stock and force them to reverse their position.
The key take away is that there is no scenario in which both sides actuall care about the issue and Intel stock doesn't drop.
Since it doesn't it means that Americans do not care about it as much as the Chinese, or do not know how to express their displeasure :)
If A cares enough about an issue and is willing to deal with the consequences and B does not then A wins and B loses.
Everyons is willing to commit something for a cause they care about. It could be as little as taking time to convince others by writing an article or a tweet, or as much as being able to commit violence for it and deal with the consequences.
One aspect of life, from negotiations to geopolitics to convince your opponent that A) you would be willing to pay a higher price than they are for your position B) you CAN pay that price.
In case of Intel v China, CCP has something to lose by banning Intel but they've demonstrated or at least convinced them and most other companies that they're willing to pay that price and CAN pay it (by the virtue of being the CCP and having absolute authority). A nation with less resources may not be able to convince a mega corp in order to get concessions.
So in this case if Americans care more about this issue they have to convince the Chinese that they're willing AND able to pay a higher price than they are.