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Fire Every One of These Traitorous CEOs Who Blew Off Shareholders

Last Updated September 30, 2020 1:36 PM
Lawrence Meyers
Last Updated September 30, 2020 1:36 PM

By CCN.com: A group of 181 CEOs of publicly held companies trading in the stock market has proclaimed their intent  to put the wealth-destroying values of anti-capitalists ahead of shareholders.

The Business Roundtable or a PR Stunt?

This group of former fiduciary stewards signed a statement produced by The Business Roundtable, a 37-year-old group, that reimagines the idea of a corporation .

Despite trying to bury the odd language in other feel-good corporate cheerleading, it’s become apparent that The Business Roundtable is yielding to elitist pressure regarding “dealing ethically with suppliers,” “supporting outside communities,” and addressing “social and economic issues.”

This is not good news for the stock market.

Kick ‘Em All Out!

Ed Butowsky , Managing Partner of Chapwood Capital Investment Management, tells CCN.com:

“That’s a group of 181 CEOs that shareholders should fire. Their job is to create value and make money for those who own the company. All the other things that they speak of is the cherry on top of the sundae. I want the sundae – earnings growth.”

Whether or not The Business Roundtable is paying lip service to the elitists – in an effort to polish their public relations image in the stock market – remains to be seen.

CEOs can talk all they want about profits no longer being the primary motivation behind a corporation, but they are required under law and regulation to provide certain fiduciary duties, which includes maximizing shareholder value in the stock market.

CEO Fiduciary Duty Trumps All

These fiduciary duties are central to the compact made between shareholders and those who run their companies.

Management in corporations has a fiduciary duty of obedience, meaning they must carry out their duties under the law and applicable corporate governing documents.

More importantly, management has a duty of loyalty to both the corporation and shareholders. The best interests of the corporation must be placed above their own personal or business interests. Conflicts of interest are not permitted.

There is a fiduciary duty of care. Management must exercise prudence in carrying out their duties to achieve the best interests of the corporation.

That’s the real sticking point.

Is it prudent for any of these corporations to engage in the behavior The Business Roundtable has trumpeted? In the eyes of the stock market, for the most part, probably not.

Shareholders want one thing: profits. That drives earnings growth, which pushes the stock market higher.

Good PR is fine, but placing fiduciary duty subordinate to the kind of nonsense The Business Roundtable mentions is criminal.