Berle-Means Thesis

Theory about governance in public corporations where the ownership and control is separated, and the owners (shareholders) rely on the board of directors to represent their interests. The theory states that over time the boards become so dominated by the management that their supervisory role becomes ineffective and the executives get to have the final say. Named after Adolf A. Berle and Gardner C. Means, the US authors of the 1932 paper ‘The Modern Corporation and Private Property.’

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