Comment by fastball
3 days ago
Yes, owners of companies obviously control them.
That doesn't make the CEO a figurehead.
There isn't a company in existence where the (hired) CEO has more power than the person who owns the company.
3 days ago
Yes, owners of companies obviously control them.
That doesn't make the CEO a figurehead.
There isn't a company in existence where the (hired) CEO has more power than the person who owns the company.
In order:
- No. There are many companies that have board mandates such that one single entity can never have a prima facie super-majority of voting power.
- Yes it does. Under this structure, the CEO has no voting power on the board or right to initiate matters before it. Usually, a CEO has at least 1 vote and that right.
- Not true in corporations where there are distinct cohorts of stock classes such that the owners of (e.g. class "A") a particular stock have 10-100x more voting power than (e.g. class "B") and as a "price" to assume the role of CEO one must "purchase" a controlling majority of shares.
- I didn't say a single entity, I said "owners". In the case of X there are many owners, Elon Musk with the most power. Nobody who is not an owner controls the company, which is what you would need to demonstrate to invalidate my point.
- A "figurehead" is someone who cannot make meaningful decisions / impact. This does not automatically apply to any CEO who does not having voting power on the board or with shares. You can very clearly run an entire company in a very real way without a single board seat or share. Many CEOs have done it in the past, many will do it in the future. Just like how you can be the manager of an auto-repair shop without owning a bit of it and you're not automatically a "figurehead manager".
- A CEO who owns a majority of preferred shares is in fact the/an "owner" of the company. One owner having more control than another is obviously not the purpose of this conversation. The question is whether a hired CEO without voting power (whether via the board or with shares) is automatically a figurehead. Demonstrating that a CEO can be an owner with more power does not change that, because the question is about CEOs without meaningful ownership. This is obvious to anyone not trying to create a "gotcha".