The Myth of Shareholder Capitalism.
hbr.org
hbr.org
The fact that directors usually aren't fired mid-term is a symbol of the system working, not the opposite. At a certain size, being public is almost always the best way to capture the feedback of the market in the long run.
It's like democracy: we get to have a small, orderly revolution every few years. In return we don't randomly go around killing our rulers. The result is almost never exactly what anybody wanted, but in the long run, it's consistently better than the alternative.
(I often find myself thinking this is why capitalism attracts so much enmity, as it is a major economy system that only makes sense when you consider second-order effects, perhaps the only such major system. Socialism and communism all have soothing first-order stories ("Is somebody richer than you? Take it from them, and they'll be less rich and you'll be more rich! And let's not worry about the second-order effects of such actions! Everything will always stay the same! Wheee!") and the problems don't arise until you consider the second-order effects.)
Most intelligent socialists know about the "second-order effects", to use your terminology. Some of the effects of redistribution are good (better-educated populace, social stability) and some are bad, depending on the extent of it and how it is done.
I have much more respect for people who hold opinions which disagree with mine and have actually thought them out, rather than just coming to the opinions they have because it seems... nice.
This is interesting, I think, because the question of fiduciary responsibility comes up here on HN from time to time.
It seems to me that the author is starting out with the assumption that corporations are evil, or at best amoral. If one drops this assumption, the explanation is easy: even without courts forcing them to do so, corporate Directors tend to want to do what's best for their shareholders.