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this post was submitted on 27 Oct 2023
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Fearing enshittification is one reason I want to keep my company private. If I have to answer to stockholders, then I’m not answering to customers, and that’s shitty.
I've always worked for smaller private companies because my partner always got screwed working at bigger corporations.
I get it. His most recent post talks about how enshittification isn't just limited to digital platforms, it's inevitable whenever monopolies are allowed to form.
Avoid private equity as well. PE is equally shitty.
Well good news... you don't have to fucking answer to stockholders. That's a fucking lie perpetrated by Harvard Business sociopaths and their bootlicking bitchboys.
All you have to do is what's in the best interest of the business. If someone doesn't like it they can sell the fucking stock.
“The best interest of the business” is far too lenient in its wording. Some of the shareholder derivative lawsuits out there are fucking wild.
Simple things such as “paying your workers too much”, “acting with too much emphasis on morality over capital gains”, it all does have to come back to shareholder profits, ever since Dodge Vs. Ford.
That's not what was decided in Dodge v. Ford. That case decided that corporations are allowed to act in the interest of majority shareholders even if it hurts the interests of minority shareholders. The Dodge brothers owned Ford shares and were trying to use their position to force Ford to stop competing with Dodge.
Further:
"In fact, courts have consistently refused to hold directors liable for failing to maximise shareholder value."
"In 2014, the United States Supreme Court voiced its position in no uncertain terms. In Burwell v Hobby Lobby Stores Inc., the Supreme Court stated that “Modern corporate law does not require for profit corporations to pursue profit at the expense of everything else”.
https://legislate.ai/blog/does-the-law-require-public-companies-to-maximise-shareholder-value
The idea that corporations are hamstrung and simply must do evil things to maximize profit is actually just corporate propaganda.
Re the second part: this works differently in delaware, where over half of all fortune 500 companies were incorporated.
Willfully ignoring the minor detail about ford being sued to stop enriching the lives of their workers says enough about how productive this conversation’s going to be.
And yet that's how it works, because business is not a linear thing. Do you have any idea how long "MUXEMOOSE PROOFITS!!!!" types have been whining about the price of Costco's hot dog?
It's the cargo-cult interpretation of Dodge v. Ford Motor Co.
Meaning what?
The ruling of that Supreme Court case was that publicly-traded companies are obligated to act in the interests of their shareholders, rather than employees or customers. Cargo cultist MBA-types -- those who have superficial knowledge, but lack actual understanding -- think that means companies must be purely sociopathic and slavishly work to increase quarter-to-quarter stock returns at all costs, but that's not actually true because management is still allowed to take things like long-term stability and customer goodwill into account.
I've noted over the past few years, how any company that invests in R&D rather than pays dividends is labelled as "loss making" by the press.
I would consult a lawyer, basically iirc you can add to the bylaws that you are not just about making money and then you are only obligated to share dividends if you keep the majority of the voting rights.