The Shareholder’s Role in Corporate Social Responsibility
In The Modern Corporation and Private Property, Professors Berle and Means concluded that the corporation should serve the interests of all society and not solely the interests of its shareholders. This concept was a break from traditional corporate theory and the beginning of the theory of corporate social responsibility. The purpose of this article is to assess the modem shareholder’s role in the implementation of this doctrine. Because Berle was one of the first to consider the role of the shareholder in enforcing the corporation’s responsibility to society, this article will begin with a brief review of his ideas with respect to this problem. The writings of other scholars in the corporate area will then be examined to discover their assumptions regarding the shareholder’s interest in the modem corporation and their conclusions regarding the shareholder’s role in enforcing corporate social responsibility. Finally, the validity of these assumptions and conclusions will be analyzed in the light of recent developments in the area.