• 07 Dec 2012 at 3:48 PM

Al Gore Wants You To Conserve Your Shares

Here is a pleasing story that is probably not a thing, but still a thematically relevant non-thing:

Corporations would award long-term shareholders “loyalty rewards” of extra dividends, warrants, and additional voting rights as incentives to overcome short-term earnings focuses of corporations and investors, according to a concept Mercer is developing with two other organizations.

Good luck with that, Mercer, “who is working on the project commissioned by Generation Foundation … [which] is an advocacy arm of Generation Investment Management, whose chairman is Al Gore.” There’ll be a report by the fall so stay tuned. For a report.

I like it! For two reasons, one good, one evil. First, good: why shouldn’t companies decide what sort of a thing shareholding is? The old notions of public-company shareholding – shareholders own the company, companies owe them fiduciary duties, one share one vote, etc. – all seem to be eroding.1 That seems good! “Shareholders provide money and in exchange they own the company” is a shorthand; really shareholders provide money and get some sort of bundle of rights – embodied in the corporate and securities laws and the corporate charter and bylaws – giving them residual cash flows and a vote and whatever else. Read more »