But my question is on it’s face fact. Just because stockholders have enough stock to have controlling interest doesn’t mean they’re not stockholders.
Having the money to buy enough stock is nobody’s business but theirs, directing the course of a business is one of the benefits of becoming wealthy. How much money people earn, or have is none of our business.
It’s also true as well that if a group of “everyday” stockholders don’t like what’s happening, they can join together pool their stocks, and appoint a proxy to vote against the individual “rich” stockholder. Dependent upon the corporate rules of the company.
The thing is that most don’t care as long as their stock is increasing in value. They are more worried about daily life, and in some cases are willfully ignorant to their rights as a stockholder.
So your gripe should be with them, not the rich people who are exercising their corporate duties.
“It’s also true as well that if a group of “everyday” stockholders don’t like what’s happening, they can join together pool their stocks,”
That’s my point. No, it is NOT “true”. They don’t collectively have enough stock or ANY stock in the “preferred” class that gets to vote.
The vast majority of companies have Preferred and Common class of stocks. Most public companies also do not offer enough shares for a collective vote against the controlling interest shares. Toss in the institutional share holders and you haven’t got a prayer to outvote them.
For instance, Charter Communications (Ticker: CHTR) (I like to pick on that lousy company every chance I get):
% of Shares Held by All Insider and 5% Owners: 26%
% of Shares Held by Institutional & Mutual Fund Owners: 77%
% of Float Held by Institutional & Mutual Fund Owners: 104%
Number of Institutions Holding Shares: 319
You don’t have a prayer to outvote them using any amount of common class stock shares.
Publicly traded companies are rarely ever actually “public companies”. That term is a misnomer.