“Why have stockholders?… What contribution do they make, entitling them to heirship of half the profits of the industrial system, receivable partly in the form of dividends, and partly in the form of increased market values resulting from undistributed corporate gains? Stockholders toil not, neither do they spin, to earn that reward. They are beneficiaries by position only. Justification for their inheritance must be sought outside classic economic reasoning…. [and] can be founded only upon social grounds… that justification turns on the distribution as well as the existence of wealth. Its force exists only in direct ratio to the number of individuals who hold such wealth. Justification for the stockholder's existence thus depends on increasing distribution within the American population. Ideally the stockholder's position will be impregnable only when every American family has its fragment of that position and of the wealth by which the opportunity to develop individuality becomes fully actualized.”

— Adolf A. Berle

1967, p. xxiii
The Modern Corporation and Private Property. 1932/1967

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Adolf A. Berle 14

American diplomat 1895–1971

Harvey S. Rosen (1949) American economist

Source: Public Finance - International Edition - Sixth Edition, Chapter 17, The Corporation Tax, p. 399

“All the real money in investment will have to be made—as most of it has been in the past— not out of buying and selling but out of owning and holding securities, receiving interests and dividends therein, and benefiting from their long-term increases in value. Hence stockholder's major energies and wisdom as investors should be directed toward assuring themselves of the best operating results from their corporations. This in turn means assuring themselves of fully honest and competent managements.”

Benjamin Graham (1894–1976) American investor

Source: The Intelligent Investor: The Classic Text on Value Investing (1949), Chapter I, What the Intelligent Investor Can Accomplish, p. 17

“Few trends could so thoroughly undermine the very foundations of our free society as the acceptance by corporate officials of a social responsibility other than to make as much money for their stockholders as possible. This is a fundamentally subversive doctrine. If businessmen do have a social responsibility other than making maximum profits for stockholders, how are they to know what it is? Can self-selected private individuals decide what the social interest is? Can they decide how great a burden they are justified in placing on themselves or their stockholders to serve that social interest?”

Milton Friedman book Capitalism and Freedom

Source: Capitalism and Freedom (1962), Ch. 8 Monopoly and the Social Responsibility of Business and Labor, p. 133

“Essentially these stockholders, though still politely called "owners", are passive. They have the right to receive only. The condition of their being is that they do not interfere in management.”

Adolf A. Berle (1895–1971) American diplomat

Source: Power Without Property, 1959, p. 73; As cited in: Martin Sicker (2002) The Political Economy of Work in the 21st Century. p. 144.

“Where such a separation is complete one group of individuals, the security holders and in particular the stockholders, performs the function of risk-takers and suppliers of capital, while a separate group exercises control and ultimate management. In such a case, if profits are to be received only by the security holders, as the traditional logic of property would require, how can they perform both of their traditional economic roles? Are no profits to go to those who exercise control and in whose hands the efficient operation of enterprise ultimately rests? …Furthermore, if all profits are earmarked for the security holder, where is the inducement for those in control to manage the enterprise efficiently? When none of the profits are to be received by them, why should they exert themselves beyond the amount necessary to maintain a reasonably satisfied group of stockholders.”

Adolf A. Berle (1895–1971) American diplomat

1967, p. 303
The Modern Corporation and Private Property. 1932/1967

“Paul was a stockholder in Rome's world corporation. And that stock by slow degrees had blinded him to the injustice of a social system in whose dividends he himself shared. This explains in large part why he accepted the political status quo, and preached its acceptance by others.”

Bouck White (1874–1951) American author and novelist

Source: The Call of the Carpenter (1914), p. xxi

“So the question is, do corporate executives, provided they stay within the law, have responsibilities in their business activities other than to make as much money for their stockholders as possible? And my answer to that is, no they do not.”

Milton Friedman (1912–2006) American economist, statistician, and writer

Interview "Milton Friedman Responds" in Chemtech (February 1974) p. 72.

“Remember that you are to venture the whole salvation of your soul on Christ, and on Christ only. You are to cast loose completely and entirely from all other hopes and trusts. You are not to rest partly on Christ and partly on doing all you can. In the matter of your justification Christ is to be all.”

J.C. Ryle (1816–1900) Anglican bishop

Source: Dictionary of Burning Words of Brilliant Writers (1895), P. 591.

“The corporation as an organizational form is an enormously productive social invention. Partly because of its success it is under increasing attack from various quarters, often under the guise of “protecting” investors from self-interested managers. Some of these attacks are successful simply because the corporation is a poorly understood entity. This paper discusses what the corporation is, what it is not, and how certain misconceptions about the corporate form are fostered by its critics as part of their attack.”

Michael Jensen (1939) American economist

William H. Meckling and Michael C. Jensen, 'Reflections on the Corporation as a Social Invention,' in Controlling the Giant Corporation: A Symposium(Center for Research in Government Policy and Business, Graduate School of Management, University of Rochester, 1982

“The only loyalty to enlightenment consists in disloyalty. This can be partly understood from the position of its heirs, who look back on the “heroic” times and are necessarily more skeptical of the results. To be an heir always carries a certain “status cynicism” with it, as is well known from stories about the inheritance of family capital.”

Peter Sloterdijk (1947) German philosopher

Source: Kritik der zynischen Vernunft [Critique of Cynical Reason] (1983), p. 6

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Adolf A. Berle 14

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