Although hotly debated today, one of the prevailing theories in the mind of the public as to why the shareholders of a corporation possess the right to vote in corporate elections is the fact that shareholders "own" the corporation. Even though one academic has written that this theory is the "worst" argument for shareholder primacy, the notion that shareholders should vote in corporations because the corporation "belongs" to them is strongly entrenched in the minds of the general public; in fact, this theory of shareholder primacy often creeps into judicial opinions, showing that even judges are influenced by the theory. Although more sophisticated theories have attracted attention in recent years, the shareholder empowerment movement today can be viewed as rooted in the innate idea that shareholders deserve the right to effective control as the true owners of the corporation.
G. Scott Edwards,
Empowering Shareholders, or Overburdening Companies? Analyzing the Potential Use of Instant Runoff Voting in Corporate Elections,
68 Vanderbilt Law Review
Available at: https://scholarship.law.vanderbilt.edu/vlr/vol68/iss5/4