No one will ever confuse a corporation with a democracy.
But along one important dimension — corporate governance through shareholder and Board decision-making — corporations can start to look just a little more democratic, if you squint hard enough.
If you think of a public corporation as a small country, with the shareholders its citizens and the Board of Directors their elected leaders, then the image of a corporation as a democracy — complete with social, environmental, and governance responsibilities — begins to come into view. And that picture of corporate social responsibility through effective governance holds together as long as shareholders’ concerns are heard and Board members remain within the bounds of their role as part of a collective decision-making body charged with taking shareholder input and considering corporate concerns from multiple perspectives.
But the similarities don’t end there. Just as democracies can be lost to leaders with illusions of autocracy, corporations can lose their way and be captured by Board members who would disregard their shareholders’ concerns, dominate decision-making, and dictate outcomes, even when those outcomes might be demonstrably counter to the corporation’s own best interests. At that point, just as it is in a democracy, it is time for the leadership to change, because if the leaders stop listening to those who elected them, then the whole decision-making machinery breaks down, and the leaders must go.
And that — calling for the removal of four long-serving members of Wendy’s Board of Directors, in an effort to hold the Board accountable for Wendy’s failure to listen to its shareholders and adequately address its “longstanding troubling record on oversight of risks related to human rights and worker protections in its food supply chain” — is exactly what some Wendy’s shareholders are mobilizing to do next month at the hamburger giant’s annual meeting.
How did we get here?
Before we dive deeper into the details of the vote at next month’s shareholder meeting, let’s take a quick look back at the road that led a group of justice-minded Wendy’s shareholders to take this extraordinary step...
