https://finance.yahoo.com/news/wealthiest-10-americans-own-9...
Most business equity isn't even publicly traded; a complete accounting would show even greater inequality.
That doctor has many things they can do:
1. Make and vote on shareholder proposals.
2. Refuse to own stock in any company that does not take sufficient action to "discourage corporate misconduct."
3. Etc.
And if a policy like mine were ever implemented, it's not like rugged individuals would only be able to take rugged individual action. The legal risk would reduce returns, and sophisticated mutual fund managers would have incentive to choose stocks that don't have those risks or vote their fund shares to make corporate policy changes to eliminate them.
I get the feeling behind the desire, but this is why I don't think it's good.
You wrote up-thread:
> That's not sufficient though. The people who did the bad acts need to be punished, but the owners who profited from the bad acts need to be punished too. If you don't do that, you just create situations like Amazon: set an sounds-good internal policy but have internal incentives for employees to violate it (e.g. exploit 3rd party seller data to unfairly compete with them), then fire the employees as scapegoats when caught to deflect blame. So some harsh action needs to be taken the owners the shareholders.
And sure; but is it possible to determine when this incentive was created? If it is, can't it be stopped the moment it happens? If not, then the shareholders can't reasonably be blamed.
Unless the shareholders are the incentive, in which case sure.
That's fundamentally different. Everyone has to be citizen of some country or other, and it's difficult to change citizenships, but no one is forced to own stock in any particular company.
> And sure; but is it possible to determine when this incentive was created? If it is, can't it be stopped the moment it happens? If not, then the shareholders can't reasonably be blamed.
> Unless the shareholders are the incentive, in which case sure.
That example was meant as an illustration of using scapegoats to deflect consequences, and why the consequences have to bubble up beyond an individual doing a bad act on behalf of the corporation. I'm not sure what you mean by "the shareholders are the incentive."
My mental model for how this would work legally with shareholders would be modeled more on torts like negligence than on criminal law. So it wouldn't be necessary to determine exactly why the bad act was done to go after the shareholders, just that there was harm done on such-and-such date.
I don’t think punishing stock holders makes any more sense than punishing all of Germany after WW1 did. You need to cut the head off the snake, not nibble at the tail. A hypothetical corporate death penalty should start at the top, then cascade down some amount of “tiers” down the executive chain. Executives tend to be the ones with the biggest stock rewards and the ones lining up unethical incentives in the first place.
Come on, stockholders are nothing like the subjects of a hereditary monarch.
> You need to cut the head off the snake, not nibble at the tail. A hypothetical corporate death penalty should start at the top, then cascade down some amount of “tiers” down the executive chain.
You need to do both: punish the owners and their agents.
What you're proposing is akin to punishing the generals and general staff, but letting the Kaiser get off scot free (including keeping his position).
E.g. if a shareholder says "you need to make more profit or I will close the company", they are a direct incentive to cut corners.
Don't we? Governments revenue is mostly taxes. Government pays settlements from revenue.
Ergo, every individual pays when the government is found liable.
There's no "country death penalty" for CO2 or CFC emissions, agent orange, etc.
As a passive investor, you generally hope that active investors, who have very large stakes in a company's stock, and who care about their own returns, will steer company boards responsibly.
It seems to mostly work, if it didn't, there'd be waaaaaay more fraud in the SP&500. It's noteworthy that the overwhelming part of bad corporate behavior is stuff that doesn't get seriously punished.
These lawsuits have been decently successful as far as I can tell from what stories make it to the media.
[1]: https://www.bloomberg.com/opinion/articles/2019-06-26/everyt...
Currently, 'the company admits no fault' (but pays a fine), helps head off shareholder lawsuits.
If prosecuting entities and companies were instead required to include admitting fault, then shareholder suits would be much simpler.
The company has already admitted liability -> process directly to negotiation over amounts.
It would work only to the extent that it discouraged most corporate conduct.