What is the true state of U.S. shareholders rights in relation to the rest of the world?
“U.S. shareholders’ rights are not higher than in other countries and yet it’s rarely commented upon. In the UK only 10 percent of shareholders can call an EGM on 12 days notice for the removal of any or all directors. Some U.S. states purport to have laws, but either don’t, or do not enforce them. Boone was very good for corporate law business. Why isn’t there more activism? The short answer: “It is very hard work.” Mr. Monks gave an example related to his own experience 15 years before as a shareholder who offered himself as a nominee for the Board of Directors of the Sears Corporation; “You have to pay all expenses, and your return is 1/10 to 1/20 your cost. It takes a lot of time and money to run for a seat.” This reflects a collective action problem. Mr. Monks cited a principle that discourages more participation on behalf of shareholders: “What is in the interest of the collective, is not in the interest of the collective’s individuals.” He conjectured that perhaps, “This is why
