I don't think so either, but remember that the members of
the board are also large stockholders themselves, in the
great majority anyway.


Dave wrote:
In most cases, no, though in the case of smaller companies that's more often
the case.


IIRC each member of the board of Coca Cola (to pick just a
random example) holds a couple million shares. I call that a
"large" stock holding, and I don't call it a "smaller
company." Every other company I've ever owned stock in had a
similar situation on their board.



.... But in
practice it's extremely difficult for shareholders to oust a board. Why?

IMHO it's because relatively few shareholders even read
their quarterly reports much less the voting booklet. The
few that vote tend to fill in the block marked "board of
directors recommends this." Remember also that a huge
percent of stock is owned by retirement funds, mutual funds,
etc etc, instead of individuals. These stock shares tend to
be voted by proxy granted to the board.


Doug, nearly all votes at a corporate shareholders' meeting are voted by
proxies granted to designees of the board. Those voting the proxies must
vote as the shareholders returning the proxies indicate on their cards.

Please pay attention. There is a difference between a proxy
which is voted as the SHAREHOLDER directs (marked on the
card), and the shares being voted the way the DIRECTOR
wants. Did you really think I was not making this
distinction, or just trying to obfuscate (the way you're
always accusing me of doing)?


... If
the proxies are returned but the way to vote is not specified, the proxies
are voted as management recommends.


Or if the owner of record has granted voting discretion by
pre-agreement, as is commonly done with retirement funds,
mutual funds, etc etc. As I understand it, this is not "as
management recommends" but is granted to a specific
individual board member.


Do you really think that major shareholders show up at corporate meetings
and cast ballots there? Doesn't happen.

The ones I've been to, they show up. It's part of the
circus. I'm quite sure they all know in advance which way
the board is voting.

Doesn't change the basic premise, that the shareholders are
the owners and in most cases have abdicated their
responsibility. We seem to be in agreement on this point.

DSK