Won’t diverting corporate resources to social agendas diminish shareholder value?

Apologists for the status quo might have us believe so, but it is simply not true. The drag of managerial capitalism on the global economy is enormous, due to financial abuses, outlandish executive compensation, cronyism, mediocrity, lack of vision, and missed opportunities. Replacing managerial capitalism with a functioning democracy of capitalism will realize hundreds of billions of dollars in untapped value.

Take Enron as just one example, the fraud and bankruptcy of that firm could easily have been prevented by a conscientious board of directors. It cost shareholders $25 billion. That money could have enhanced shareholder value or dramatically advanced a host of pressing social needs. Instead it was squandered. Corporate meltdowns like Enron are just the visible tip of the iceberg of corporations draining shareholder value.

This is not a matter of “either-or.” If shareholders want to realize honest returns from the corporations they own and at the same time pursue compelling social initiatives, there is enormous opportunity to do so. All they need is a mechanism, and the proxy exchange is that mechanism.