SPEECH from Andrew Haldane: Who owns a company?
"This might seem like a simple question with a simple answer. At least for publicly listed companies, its owners are its shareholders. It is they who claim the profits of the company, potentially in perpetuity. It is they who exercise control rights over the management of the company from whom they are distinct. And it is they whose objectives have primacy in the running of the company. This is corporate finance 101. That the public company has been a success historically is not subject to serious dispute...Yet despite its durability and success, across countries and across time, this corporate model has not gone unquestioned. Recently, these questions have come thick and fast, with a rising tide of criticism of companies’ behaviour, from excessive executive remuneration, to unethical practices, to monopoly or oligopoly powers, to short-termism. These concerns appear to be both strongly-felt and widely-held."
This speech was given at the University of Edinburgh Corporate Finance Conference held on 22 May 2015.
Read the entire speech here
Who owns a company?