« iepriekšējāTurpināt »
unbearable pressure on the governmental authority to Former Federal Power Commission member Charles grant the permit,” he said. LILCO has spent $55,000,000 Ross said: “Unfortunately, this is the way the world of on the Shoreham project of which little could be recovered big business operates. It's not illegal as far as I know. if the plant were rejected by the Atomic Energy Com- From my standpoint, this is one of the most discouraging mission.
situations from a regulatory standpoint. You're trying to Vic Reinemer, co-author with Sen. Lee Metcalf (D- regulate from the point of view of cost of services. You're Mont.) of the book: “Overcharge: How the Electric trying to make sure the consumer is getting the least Utilities Exploit and Mislead the Public and What You costly product ... It's the function of the regulator to Can Do About It," said of the LILCO-Stone & Webster act as if we had a free competitive society whereby links: “Every time somebody painfully puts together one everybody is out cutting each other's throats. When you of these profiles, it shows undue influence of economic have interlocks, human nature dictates you're going to power by half a dozen influential New York banks." try to minimize the risk involved.”
29-553 0.74 - 27
AN ALTERNATIVE TO CONCENTRATION OF VOTING RIGHTS
THE LIBRARY OF CONGRESS,
sixty, one vote; for every eight shares above sixty, CONGRESSIONAL RESEARCH SERVICE,
and not exceeding one hundred, one vote; and for Washington, D.C., May 25, 1973. every ten shares above one hundred, one vote; but To: Hon. Lee Metcalf.
no person, copartnership, or body politic shall be From: Julius Allen, Congressional Research Service.
entitled to a greater number than thirty votes. And, Subject: Literature relating to modification of the "One after the first election, no share or shares shall confer Share, One Vote” Rule in Corporation Voting.
a right of suffrage, which shall not have been holden The references in this bibliography are divided into three calendar months previous to the day of electhree general categories: (1) those on modifications of the tion. Stockholders actually resident within the United "one share, one vote" rule in 18th and 19th century States, and none other, may vote in the elections by American experience; (2) those on foreign experience limit- proxy. ing the power of large stockholders; and (3) more general No comparable statement by any other American works that significantly raise issues of the powers of statesman has been found. stockholders.
However, there are several cases in which a one vote per
shareholder or other modifications of one vote per share I. ModifiCATIONS OF THE "ONE SHARE, ONE VOTE" RULE common, particularly in government-regulated IN 18TH AND 19TH CENTURY AMERICAN EXPERIENCE industries. Such modifications were less common in manu
It seems likely from a survey of relevant literature that facturing industries. Chief references are the following: the most articulate statement on this subject was made by Cadman, John W. The corporation in New Jersey, business Alexander Hamilton in his report on the National Bank
and politics, 1791–1875. Cambridge, Mass., Harvard communicated to the House of Representatives on Decem
University Press, 1949. 462 p. ber 14, 1790. In it he stated:
Extensive discussion of stockholder voting rights in “A further consideration in favor of a change is the Chapter 10, “Stockholders and Directors”, particularly improper rule by which the right of voting for directors
on pp. 307-312. is regulated in the plan upon which the Bank of North Davis, Joseph Stancliffe. Eighteenth century business America was originally constituted-namely, a vote for each share; and the want of a rule in the last charter
corporations in the United States. [Essay No. 4) in unless the silence of it, on that point, may signify that
Essays in the earlier history of American corporations, every stockholder is to have an equal and single vote,
v. 2. Cambridge, Harvard University Press, 1917 which would be a rule in a different extreme, not less erroneous. ..
See especially pp. 323-326. “A vote for each share renders a combination between Dodd, Edwin Merrick. American business corporations a few principal stockholders, to monopolize the power and benefits of the bank, too easy. An equal vote to each stock
until 1860, with special reference to Massachusetts. holder, however great or small his interest in the institu
Cambridge, Harvard University Press, 1954. 524 p. tion, allows not that degree of weight to large stockholders A classic work on the early legal history of American which it is reasonable they should have, and which, per
corporations. Limitations on voting rights in corporations, haps, their security and that of the bank require. A largely those incorporated in Massachusetts, are cited on prudent mean is to be preferred.” 1
the following pages: banks: 202–203, 212–215; insurance Specifically, Hamilton's plan for the national bank companies: 219, 225, 293, 304-305, 309; manufacturing called for the following voting rights provisions:
corporations: 230-232, 326; toll bridge companies: 237– II. The number of votes to which each stockholder 238, 241; turnpike companies: 243, 245; canal and river shall be entitled shall be according to the number of improvement companies: 249-257; transportation comshares he shall hold, in the proportions following panies, including railroads: 259-266, 262, 328, 333n., 344. that is to say: For one share, and not more than two Sawyer, Henry W. III. The right of holders of “non-voting" shares, one vote; for every two shares above two, and not exceeding ten, one vote; for every four shares
shares to vote on increase of capital stock: Pennabove ten, and not exceeding thirty, one vote; for
sylvania and other state constitutions. University of
Pennsylvania Law Review, v. 95, Dec. 1946: 203-213. every six shares above thirty, and not exceeding
See especially p. 212 for change in Pennsylvania statutes · Reprinted in: The Works of Alexander Hamilton. Edited by on corporate voting rights. Henry Cabot Lodge. New York, G. P. Putnam's Sons, 1904. v. 3. pp. 422-423.
Same, p. 434.
A. ENGLISH LANGUAGE PUBLICATIONS
Sneed, Earl. Stockholder votes in adverse interest. 1960. general, German banks play & much more dominant role
Consists of reprints of the following three articles: “The in industrial management and control than do banks in
Of the six following publications the last, by Detlev The evolution of the one share-one vote rule is dealt Vagts, is probably the most comprehensive and useful. with at the beginning of the first article, pp. 23-24. These Church, Edgar M. Business associations under French pages are attached as Attachment A.
law. New York, Fallon Law Book Co., 1960. 589 pp. Williston, Samuel. History of the law of business corpo- On stockholder voting powers, see paragraph 351-352,
rations before 1800. Harvard Law Review, v. 2, Oct. pp. 427-431, and paragraph 385, p. 470. 15 and Nov. 15, 1888: 105-124, 149-166.
de Sola Canizares, F. The rights of shareholders. InterReprinted in a revised version in : Association of Ameri- national and Comparative Law Quarterly, v. 2, Part can law schools. Select essays in Anglo-American legal
4, October 1953: 564-578. history, v. 3, pp. 195–235. Boston, Little Brown, 1909. Includes a brief discussion on shareholders' right to
On changing voting rights of shareholders see pp. 156- vote under the law of various countries, excluding English 158.
speaking countries, on pp. 568-569. Cites laws of various
countries. II. Foreign ExPERIENCE LIMITING THE POWER OF LARGE Eckert, Dieter. Shareholder and management: & comSTOCKHOLDERS
parative view of some corporate problems in the No reference was found that provided a better overview
United States and Germany. Iowa Law Review, v. in English of corporation law in foreign countries modify
46, Fall 1960: 12-83. ing the “one-share one-vote" rule than the David Ratner
Voting procedures in shareholder meetings discussed on article cited below, p. 398.
For comparative purposes the following paragraphs Falkenhausen, Bernhard v. and Ernst C. Steefel. Sharegive related information, and are a translation from a holders' rights in German corporations. American 1966 thesis of voting restrictions in the securities legislation
Journal of Comparative Law, v. 10, Autumn 1961: of the European Common Market, "Stimmverbote in den
407-431. Aktienrechten der EWG-Staaten" by Hellmut Meyer- Stockholders' voting rights are discussed on pp. 411–12. Giesow.
Florence, P. Sargant. Ownership, control and success of Legislation and governmental regulation deter
large companies: an analysis of English industrial mine the limits of the voting strength of the
structure and policy, 1936–1951. London, Sweet and individual shareholder. As a general rule, the
Maxwell, 1961. 279 p. principle holds everywhere that the voting Includes a consideration of the relationship between strength of the shareholder is proportional to the
voting rights and control of large British corporations. No number of shares he owns: the larger his share
discussion of “one share-one vote" rule. Considers differholdings, the greater the weight of his voting ences among kinds of shareholders, including "personal, rights.
company, institution, nominee, and mixed." This basic principle suffers from exceptions Vagts, Detlev F. Reforming the "modern” corporation: through legal provisions that set upper limits to
perspectives from the German. Harvard Law Review, the voting strength of a stockholder, or require
v. 80, November 1966:23-89. ownership of a minimum number of shares in
A comprehensive survey of major elements in the order to qualify to vote. Thus under Belgian and structure and control of German corporations, with comLuxembourg law, no one shareholder may vote parisons to the United States. Particularly relevant is more stock than 20 percent of the issued capital Part IV, "Representing the Shareholder Constituency", stock or 40 percent of the capital stock repre
pp. 48–64, which includes extensive discussion of the role sented at the shareholders' meeting. In France, of banks as spokesman for shareholders. articles of incorporation may set forth the top limit of shares eligible to be voted as well as the
LANGUAGE PUBLICATIONS minimum required for participation in shareholders' meetings. In the organizational meeting,
These publications deal with voting rights in West an individual shareholder is limited to a maxi- Germany, Switzerland, France, other countries of the mum of ten votes. Also in Germany the articles of European Common Market, and the United States. The incorporation can limit the maximum number of most comprehensive and useful, comparing German and shares eligible for voting. A similar situation pre- United States practices, are the two works by Ernstvails in Holland. Only in Italy is no limitation of Joachim Mestmäcker and by Rudolf Wietholter. voting rights possible.
Böckli, Peter. Das Aktienstimmrecht und seine Ausübung There is a substantial literature, primarily in German,
durch Stellvertreter. Basel, Helbing & Lichtenhahn, on the extent to which banks exercise proxy rights in
1961. 233 p. voting shareholders' stock which they hold in trust. In A detailed thesis on voting rights of stockholders and
their execution by proxies. See pp. 43–49 for Swiss statu1 Meyer-Giesow, Hellmut. Stimmverbote in den Aktienrechten
tory limitations on stockholders' voting rights. der EWG-Staaten. Munich, Bauknecht, 1966. pp. 5-6.
Busse, Andreas. Depotstimmrecht der Banken. Wiesba
den, Betriebswirtschaftlicher Verlag Dr. Th. Gabler,
1962. 220 p. A comprehensive treatise on voting rights exercised by banks in Germany; their significance to industry, banks, competition among banks and to stockholders. The divergence of interest between small and large shareholders is stressed. Goehrmann, Peter. Das Informations- und Stimmrecht
des Aktionärs im neuen französischen Gesellschafts
recht. Berlin, 1969. 383 p. A dissertation on information and voting rights of stockholders under the new French legislation of 1966. Includes a comparison of French and German law on voting rights of stockholders, including limitations of the one-share onevote rule, pp. 150–210. Horn, Arno. Zum Mitverwaltungs- und Kontrollrecht der
Aktionäre. Die Aktiengesellschaft, v. 14, December
1969: 369–374. A convenient survey of stockholder rights in Germany, including voting rights. Kutzenberger, Gerhard. Mitbestimmung der Aktionäre;
ein wirtschaftswissenschaftlicher Beitrag zur Aktienrechtsreform. Berlin, Duncker & Humblot, 1964.
250 p. Thesis on the role of stockholders in corporate management. Voting rights are extensively discussed. Comprehensive bibliography on pp. 229–250. Mestmäcker, Ernst-Joachim. Verwaltung, Konzerngewalt
und Rechte der Aktionäre, eine rechtsvergleichende Untersuchung nach deutschem Aktienrecht und dem Recht der Corporations in den Vereinigten Staaten.
Karlsruhe, Verlag C. F. Muller, 1958. 399 p. Work is a comparative legal study of the management and authority of corporations as related to rights of shareholders in Germany and the United States.
Includes extensive references to voting rights. See especially p. 11, where in essence the "one share one vote" doctrine is defended; pp. 44-47 which discussses elections of the board of directors in U.S. corporations; pp. 60-65 on proxy voting in the United States, and limited authority of stockholders, pp. 92-95 for German voting practices of stockholders; including proxy authority of banks. Meyer-Giesow, Hellmut. Stimmverbote in den Aktien
rechten der EWG-Staaten. Munich, G. Bauknecht,
1966. 172 p. A dissertation on limitations on stockholder voting rights in the European Economic Community. Püttner, Günter. Das Depotstimmrecht der Banken. (Ber
liner Juristische Abhandlungen, Band 7). Berlin.
Duncker & Humblot, 1963. 174 p. A detailed survey of the problem of banks' voting rights on behalf of stockholders. Includes extensive bibliography, pp. 165-174. Tiling, Johann. Die Macht des Aktionärs in der Gener
alversammlung der französischen Aktiengesellschaft.
Hamburg, Cram, de Gruyter & Co., 1965. 133 p. A dissertation on the powers of shareholders in annual meetings of French corporations. Limitations on one share one votc rule are described on pp. 69–73. Vallenthin, Wilhelm. Die Stimmrechtsvertretung durch
Banken nach dem Aktiengesetz von 1965. Frankfurt am Main, Fritz Knapp Verlag, 1966. 60 p.
A treatise defending for the most part banks' voting rights on behalf of stockholders. Wiethölter, Rudolf. Interessen und Organisation der Ak
tiengesellschaft im amerikanischen und deutschen
Recht. Karlsruhe, Verlag C. F. Müller, 1961. 362 pp. A comprehensive legal study comparing corporate organization and interests in the United States and Germany. Comprehensive bibliography on pp. 342-362.
See especially pp. 131-139, which discusses "shareholder democracy” vs. "capital share democracy". III. Basic WORKS IN ENGLISH ON VARIOUS ASPECTS OF
STOCKHOLDER VOTING Power AND INFLUENCE CORPORATION MANAGEMENT, With PARTICULAR REFERENCE TO BANKS
A number of the references raise issues on the extent of, or lack of, bank influence in corporate policy that should be considered in more detail. Thus, for example, Paul P. Harbrecht in his 1959 study, "Pension Funds and Economic Power”, issued by the Twentieth Century Fund, notes:
It is quite likely that certain large New York banks will soon approach a point where their combined holdings of stocks for pension funds could give their opinions considerable weight in the councils of the larger corporations. While it is the policy of many large corporations to include provisions in their pension plans to prevent their funds from gaining control of other corporations, no such restrictive policy has yet been announced by the banks. Unquestionably, they will seek to spread their stock investments widely to stave off acquiring the responsibility of corporate direction as long as possible. But as the stock purchases of the pension funds continue to grow, we can anticipate that at some time in the not-too-distant future the banker-trustees are going to be faced with an uncomfortable choice. They will have to buy into a position of authority in the larger corporations or reject profitable investments in order to avoid the responsibilities that accompany large share
holdings. In a similar vein, David Ratner in 1970 wrote:
It would hardly lie in the mouths of the institutional managers to complain about being deprived of votes that they have so clearly indicated they do not want. Reducing the voting power of large blocks of shares might actually make their investment job easier. As these institutions grow to mammoth size, they find their opportunities for equity investments limited to the very largest publicly-held corporations, which are the only ones in which they can invest their millions without finding themselves, willy-nilly, in control because of the number of votes they can cast. If they could purchase larger percentage interests in smaller companies without automatically acquiring the control position they say they do not want, the access of the smaller companies to the principal equity capital markets might be
improved.? 1 Harbrecht, Paul P. Pension funds and economic power. New York, Twentieth Century Fund, 1959, p. 248.
? Ratner, David L. The government of business corporations; critical reflections on the rule of “one share, one vote." Cornell Law Review, v. 56, November 1970, p. 49. (Professor Ratner's article is reprinted in this appendix, beginning on p. 398.)