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- "[C]orporate governance would be expected to be superior under family owner-operators versus a diversified base of small shareholders with an elected board of representatives to oversee professional managers. There are deep-rooted agency problems with the traditional public company governance model, where shareholders don’t have a meaningful stake in the company to have any control or influence over its management, nor real concern for its long-run prospects. It’s always easier to sell and pass the problem off to someone else than to take an organized stand, similar to the problems of democratic political systems. The boards become captured by the managers, just like governments become captured by special interests. The end result is chaos, short-termism and relative instability and insecurity for all involved. Family-based owner-operator management can remedy all of this: concentrated ownership creates unity of strategic vision and needs, especially within the framework of multi-generational planning; the unification of owner demands and management representation ensure the vision will be clearly articulated and enforced, with severe consequences for managers who go rogue; and the lieutenant network or junior-family member approach increases the likelihood that managers can better align their sense of well-being with the family’s and by extension, the company’s." From AHR.
- "Why commodity companies might not be as cheap as they seem (and GMO is likely wrong)" Vienna Capitalist
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