Dual-class shares: has the fight been lost?
The link between share ownership and voting rights has been weakening for a long time. With dual-class share structures more popular than ever, is the struggle to resist their rise now over?
Some time ago, alongside a tale of a lost puppy that rode the New York subway from 14th to 137th Street for a whole day, an article in the New York Times warned its readers of something fearsome: a ‘New Menace in Corporate Financing’.
The story was prompted by an announcement the previous day by the New York Stock Exchange (NYSE). Its governors were bothered about certain tendencies in modern corporate practice, including: “The creation of two classes of common stock between which the only substantial difference lies in the fact that one class votes while the other class does not.”