Corporate boards need to move forward with care

Recently, I have read commentaries favoring a plan to re-make corporate America by making corporate boards accountable to “stakeholders” representing labor. That probably includes labor union members, customers and environmentalists – probably “social justice warriors.”

This is to be done to make companies more “accountable to the public” and to reduce their current obligation to maximize shareholder values (capitalism) into a mixed set of obligations in which shareholder values are a sharply reduced obligation of the boards.

As a 73-year-old shareholder throughmy individual retirement accounts and other retirement plans in a number of corporations, this proposal scares me.

If corporate boards are comprised in large part of union members and social justice warriors, I feel the interests of shareholders who have actually put up the capital to allow the companies to operate will be greatly reduced. This is, in effect, a partial nationalization of the companies’ capital, in order to have the companies fulfill the political and social justice aims of those who would be inserted onto the boards of directors.

The inevitable result will be sharp diminution of shareholder values within the companies, a comparable sharp drop in the stock values and a substantial hit to retirement plans. I predict that even the most currently solvent retirement plans may be unable to meet their obligations to the retirees.

The Democrats claim that stock values are only important to “the rich.” Actually, they are equally important to all who have 401(k)s, IRAs or take part in retirement plans. That is most of the country’s citizens.

— Peter H. Behr Jr.,

San Anselmo