> However, I still take issue with the statement that a corporation is not "owned" by the shareholders. As a matter of law, a corporation is owned by the shareholders.
As a matter of law a corporation is not:
> Simply and clearly, the corporation owns its own assets. In the simplest terms, a private company became a public company when the original owners gave up ownership. In turn, they received a stock certificate outlining certain rights to profits and other privileges. What they got, again, was a stock certificate not a certificate of ownership. The word “ownership” does not appear in that document. Additionally, while the shareholders are entitled to a portion of profits, as shareholders, they are no longer exposed to liabilities of the companies in which they hold shares.
> This paper demonstrates that shareholder ownership, a sacred cow of business, is a myth. According to our legal system, shareholders do not own the Modern Corporation itself, nor do they own the corporate assets or profits. […]
> They were already a publicly traded corporation. Their interests have never been aligned with yours fundamentally, they've been aligned with a fiduciary duty to make profit for shareholders. Literally nothing about the profit motive has changed.
This is a trope that needs to stop. Public companies are not alike and the fiduciary duty is only a very high level one that can be used to justify both squeezing every customer as much as possible to losing money to support growth.
What the shareholders want matters and an acquisition changes that completely.
>> A companies purpose is to make money for its shareholders.
As a blanket statement that is false. The purpose is whatever the founder(s) wants. If shares are sold then agreements have to be made which may or may not involve changing the purpose.
> So you own something, but have absolutely no rights to the profits and practically no decision making power. In the spirit of the usual definition of "owning" something, you do not own anything with stocks.
I would disagree.
I can sell those stocks I own and (hopefully) get more money than I paid for them. Sometimes they pay me a dividend too (share of profits). Sounds like ownership to me. I don't care about decision making power within the company. I LIKE that I have delegated that responsibility.
>> But the CEO of a publicly-traded company expressly does not have the option of sacrificing profits for any higher purpose, unless that directive comes from his shareholders.
> Also when you buy a share of Apple you are not a part owner of the company.
This is totally wrong.
> as a shareholder you're entitled to very little and do not have legal rights to demand profitability.
Only if you are an isolated minority shareholder. If shareholders group together form a quorum (+ 50% of total ownership), they can demand anything from their company - including replacing the entire board and taking operational control of the company.
> Would it be technically possible for a company to buy all of its shares back so that there are no owners? The company would be self-owned.
No, because there's a statutory minimum number of shareholders (which varies by country but is always greater than zero).
But even if this weren't the case, it wouldn't be as weird as it sounds. In most states, nonprofits cannot issue stock, but they still exist as corporate entities.
The directors ultimately control the company. Shareholders are secondary: irrelevant, except insofar as they can vote out the board of directors.
> No, you buy them because you want to support good, non-nefarious companies with sound business models.
No, you really are buying the company stock because of current and future profit prospects. None of this supporting thing... a shareholder is just the owner of the share, nothing more.
Neither of these two things are true.
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