Interactive Investor

Merryn Somerset Webb: we all have the power to transform capitalism

15th February 2022 09:07

Merryn Somerset Webb from ii contributor

This article is an extract from Share Power: How ordinary people can change the way that capitalism works - and make money too, by Merryn Somerset Webb.

It isn’t governments or fund managers that own the world’s big companies – and therefore they shouldn’t really be the ones to dictate how those companies interpret “good” and “bad”. The truth is that we own the companies and we should be the ones telling them how we want them to behave; essentially how we want capitalism to be reset (assuming we do – it isn’t a given).

What do I mean when I say we own them? In the UK, pretty much everyone (in work at least) now owns shares in our listed companies. Two and a half million people have their own stocks and shares Individual Savings Accounts (ISAs). Two million people have opened self-invested personal pensions (SIPPs) inside which they tend to hold shares in one form or another. Anyone employed and earning over £10,000 will have been auto-enrolled into a pension scheme by their employer (you can opt out but very few people do). And all these pension schemes hold shares.

Most developed countries will have a similar system, although the UK’s is particularly good. So one way or another, we are all effectively part owners of the corporate world. That common ownership people say they crave? We already have it. Every share we own comes with a vote over company decisions; everything from executive pay to who gets to be on the board of directors and any major shifts in corporate goals or strategies.

What if we were to use those votes? Fed up with companies letting themselves be sold abroad? We can vote against it. Not convinced that an oil company should spend billions becoming a renewable energy company instead of just winding down and paying out the cash? We can vote against it. Angry with a mining company that has caused pollution in the rivers around its sites? We can vote against its directors keeping their jobs. The transformation of capitalism is – technically at least – in our gift.

This extract is taken from: We own the companies: pages 12-13.

Merryn Somerset Webb is editor-in-chief of MoneyWeek, the UK’s best-selling financial magazine, as well as a contributing editor and weekly columnist at the Financial Times. She is also a non-executive director of several UK-listed investment trusts and an attendee to the interactive investor investment committee. She is a regular media commentator and speaker on all things financial.

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