178:, advanced the theory of shareholder primacy which says that "corporations have no higher purpose than maximizing profits for their shareholders." Friedman said that if corporations were to accept anything but making money for their stockholders as their primary purpose, it would "thoroughly undermine the very foundation of our free society." His article, "A Friedman Doctrine: The Social Responsibility of Business is to Increase Its Profits", was published September 13, 1970, in
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136:'s opinion, it stated that "There should be no confusion... A business corporation is organized and carried on primarily for the profit of the stockholders." It is commonly asserted that the case established a precedent that managers had to maximize shareholder profit, but the status of the court's statement on the topic is disputed, with some legal scholars arguing that it constitutes
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is an employee of the owners of the business. He has direct responsibility to his employers. That responsibility is to conduct the business in accordance with their desires ... the key point is that, in his capacity as a corporate executive, the manager is the agent of the individuals who own the
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interests should be assigned first priority relative to all other corporate stakeholders. A shareholder primacy approach often gives shareholders power to intercede directly and frequently in corporate decision-making, through such means as unilateral shareholder power to amend
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election contests. The shareholder primacy norm was first used by courts to resolve disputes among majority and minority shareholders, and, over time, this use of the shareholder primacy norm evolved into the modern doctrine of minority
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John F. Olson (May 2007). "Professor
Bebchuk's Brave New World: A Reply to 'The Myth of the Shareholder Franchise'".
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Milton
Friedman. "A Friedman Doctrine: The Social Responsibility of Business Is to Increase Its Profits".
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469:"The Modern Corporation and Private Property The American Corporation Is in Crisis—Let's Rethink It"
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published its alternative view, focused on long-term benefits for a broad range of "stakeholders."
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Posner, Cydney (August 22, 2019). "So Long to
Shareholder Primacy".
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Shareholder primacy was first articulated in the decision of
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deal primarily with the United States and do not represent a
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corporation ... and his primary responsibility is to them.
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576:"How shareholders jumped to first in line for profits"
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32:The examples and perspective in this article
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143:In their 1932 publication on foundations of
608:"Jack Welch's legacy: serving shareholders"
426:The Modern Corporation and Private Property
390:"Why We Should Stop Teaching Dodge v. Ford"
154:The Modern Corporation and Private Property
639:"Jack Welch Elaborates: Shareholder Value"
70:Learn how and when to remove this message
498:Friedman, Milton (September 13, 1970).
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423:Berle, Adolf; Means, Gardiner (1932).
219:, a former student of Friedman at the
467:Palladino, Lenore (October 1, 2019).
359:"The truth about shareholder primacy"
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300:Smith, D. Gordon (Winter 1998).
110:James Kee wrote in 1995 for the
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588:from the original on 2019-07-28
556:from the original on 2019-07-22
345:, vol. 13, The Free Market
116:corporate social responsibility
16:Concept in corporate governance
357:Gordon Pearson (25 May 2012),
302:"The Shareholder Primacy Norm"
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684:Wartzman, Rick (2019-08-19).
118:and other legal obligations.
536:"The Stock-Buyback Swindle"
534:Useem, Jerry (2019-07-22).
145:United States corporate law
46:, discuss the issue on the
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606:Tong, Scott (2020-03-03).
574:Tong, Scott (2016-06-14).
306:Journal of Corporation Law
342:The Ethical Corporation?
394:SSRN Electronic Journal
388:Stout, Lynn A. (2007).
129:Dodge v. Ford Motor Co.
431:Transaction Publishers
339:James Kee (May 1995),
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171:Capitalism and Freedom
134:Michigan Supreme Court
105:shareholder oppression
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221:University of Chicago
210:. September 13, 1970.
722:Corporate governance
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376:204 Mich 459
87:corporate governance
52:create a new article
44:improve this article
275:Virginia Law Review
243:Business Roundtable
198:corporate executive
83:Shareholder primacy
505:The New York Times
318:10.2139/ssrn.10571
208:The New York Times
181:The New York Times
168:In his 1962 book,
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255:Friedman doctrine
217:Michael C. Jensen
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159:Adolf Berle
91:shareholder
716:Categories
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592:2024-07-01
560:2024-07-01
261:References
228:Jack Welch
215:Economist
196:system, a
149:governance
122:Background
550:2151-9463
514:0362-4331
449:258284924
410:1556-5068
48:talk page
696:Archived
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287:25050360
249:See also
204:—
60:May 2022
42:You may
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326:10571
312:(2).
283:JSTOR
188:In a
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