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The “Changes in Ownership: Beyond the Berle-Means Paradigm” Symposium, held April 2013, explored whether, and how, the recent explosion of new ownership models alters the paradigm of dispersed ownership developed by Adolf Berle and Gardiner Means three generations ago. That model indicated that public corporations were owned by dispersed shareholders whose separate ownership positions were too small to justify extensive monitoring of managerial performance. This view of the distribution of ownership in U.S. corporations has been foundational for both much academic work and for much of corporate law and governance, which have been aimed at addressing the monitoring shortfall.

The Symposium explored three specific developments in corporate ownership that may indicate a sea change in the landscape painted by Berle and Means. The first development was a resurgence of companies going public with dual-class stock, similar to the Swedish capital structure, especially in the technology sector. The second development was the growth in private equity exits through a secondary buyout rather than an IPO or strategic sale. The third and final development explored at the Symposium was the re-concentration of public equity holdings, as a result of investment intermediation, that has put the potential for control into the collective hands of a much smaller, more concentrated group of holders.

This briefing will summarize the day’s discussions on whether these various developments represent an explosion in ownership forms that represent a real diversification and complication of the pattern of ownership of U.S. corporations — a new pattern that truly reaches “Beyond the Berle- Means Paradigm”.


Session Brief No. 1