Description

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Top Cornell law professor Lynn Stout and her coauthors Tamara Belinfanti and Sergio Gramitto offer a visionary but practical proposal to provide a guaranteed minimum income--it not only avoids creating a new government program or increasing taxes, but also gives the entire citizenry more influence in the economy.

Corporations have a huge influence on the life of every citizen--this book offers a visionary but practical plan to give every citizen a say in how corporations are run while also gaining some supplemental income. It lays out a clear approach that uses the mechanisms of the private market to hold corporations accountable to the public.

This would happen through the creation of what the authors call the Universal Fund, a kind of national, democratic, mega mutual fund. Every American over eighteen would be entitled to a share and would participate in directing its share voting choices. Corporations and wealthy individuals would donate stocks, bonds, cash, or other assets to the fund just like they do to other philanthropic ventures now. The fund would pay out dividends to its citizen-shareholders that would grow as the fund grows.

The Universal Fund is undoubtedly a big idea, but it is also eminently practical: it uses the tools of capitalism, not government, to give all citizens a direct influence on corporate actions. It would be a major institutional investor beholden not to a small elite group of stockholders pushing for short-term gain but to everyone. The fund would reward corporations that made sure their actions didn't harm people, communities, and the environment, and it would enable them to invest in innovations that would take more than a few months to pay off. Which is another reason corporations would donate to the fund--they could be freed from the constant pressure to maximize their quarterly share price and would essentially be subsidized for doing good.

The authors demonstrate that our current economic rules force corporations to be shortsighted and even destructive because for most large investors, nothing matters but share price. The Universal Fund is designed to be a powerful positive balancing force, making the world a better place and the United States a better nation.

About the Author

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Lynn Stout was the Distinguished Professor of Corporate and Business Law at the Jack G. Clarke Business Law Institute at Cornell Law School. She was the author of Cultivating Conscience: How Good Laws Make Good People and the award-winning book, The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public.

Sergio Gramitto is a Visiting Assistant Professor at Cornell Law School, where he also serves as the Assistant Director of the Clarke Program on Corporations and Society.

Tamara Belinfanti is a Professor of Law at New York Law School. Along with Lynn Stout, she co-founded the Ethical Shareholder Initiative, a nonprofit that seeks to revolutionize share voting to create a more sustainable corporate system.

Praise For…

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“This brave book, coming on the heels of the first author’s equally bold The Shareholder Value Myth, takes on an even bigger challenge. Its goal is to bring together civil engagement and corporate governance, free enterprise and cooperative participation, through the creation of a universal shareholder fund. Based on a mutual fund model, the proposal would broaden access, bend income distribution, and shift the leverage points in our political system away from oligarchic elites. Citizen Capitalism will contribute to the debate about the responsibility of the corporation for contributing to the public good as well as private profit.”
—Sidney Tarrow, Emeritus Professor of Government, Cornell University, and author of Power in Movement
 
“This book offers a transformative plan to make corporate ownership and governance more inclusive. It attempts to harness corporate power and resources in the tackling of the challenges of poverty and empowerment. At the heart of the book is the relationship between corporations and society. Through their proposal, the authors strive for a synergic relationship benefiting society. With clinical precision and an extraordinary grasp of history, the book offers a brilliant diagnosis of critical issues facing the world in the field of corporate governance. This is an important and valuable book. It reminds us that the only legitimate end of corporate governance is the well-being of society.”
—Muna Ndulo, Professor of Law; Elizabeth and Arthur Reich Director, Leo and Arvilla Berger International Legal Studies Program; Director of the Institute for African Development
 
“Corporations—like governments—play an essential role in the lives of every American. But most Americans have an extremely limited ability to influence corporate decision-making, and we all live with the consequences. Stout, Gramitto, and Belinfanti offer a bold and creative alternative: What if we had a tool that gave every American a say in how corporations are run—like a superpowered pension fund that made corporations accountable to more than the bottom line? This is a powerful and timely idea, and Citizen Capitalism makes the case extraordinarily well.”
—Deborah N. Archer, Associate Professor of Clinical Law, New York University School of Law
 
“Citizen Capitalism offers fresh thinking at a critical point in our understanding of the effects of shareholder capitalism—from scholars who effectively bridge theory and the practical world of investment, markets, and citizen communities. This book offers an audacious plan on how to use the rules of capitalism to address inequality. I strongly recommend it.”
—Judy Samuelson, Executive Director, Business and Society Program, The Aspen Institute
 
“The very bold plan to democratize corporate governance detailed by Stout, Gramitto, and Belinfanti in Citizen Capitalism is sure to be controversial in some circles, but it will also catalyze long-overdue discussions about the role of business in our society. Read this book.”
—Alice Korngold, Author of A Better World, Inc., and President and CEO, Korngold Consulting, LLC