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Social media is becoming an important coordination mechanism for investor concerns and actions. Could these changes lead to a shareholder democracy or a “memeocracy” dominated by social media influencers?


Investors are increasingly concerned with non-financial dimensions of corporate behavior. Investment companies large and small are aware of this and have begun to more clearly articulate voting positions on stakeholder issues, and to explore how to facilitate voting options that further empower investors. This movement towards shareholder democracy, or at least representative shareholder democracy has much to recommend it; investor voice and advocacy can improve governance, inform management and align firm behavior with investor values.

On the other hand, the “meme” stock phenomenon raises the possibility of a new, coordinated market for corporate ownership and new mechanisms for corporate governance. Social media platforms have become, for millions – perhaps billions – a primary forum for personal engagement, alignment of opinion and coordination of action. This empowerment of opinion and the rise of media influencers will almost certainly pose challenges for investment managers, especially those who are fiduciaries.

Will companies become “memocracies” owned and governed by ideological social media communities? If so, is this good or bad for companies, shareholders and society?

About the Author

William N. Goetzmann
William N. Goetzmann

William N. Goetzmann is the Edwin J. Beinecke Professor of Finance and Management Studies and director of the International Center for Finance at the Yale School of Management. He teaches portfolio management, alternative investments, real estate, and financial history and is an expert on a diverse range of investments. Professor Goetzmann’s past work includes studies of stock market predictability, hedge funds, and survival biases in performance measurement. His current research focuses on alternative investing, factor investing, behavioral finance, and the art market. Professor Goetzmann has written and co-authored a number of books, including Modern Portfolio Theory and Investment Analysis; The Origins of Value: The Financial Innovations That Created Modern Capital Markets; The Great Mirror of Folly: Finance, Culture, and the Crash of 1720; and most recently, Money Changes Everything: How Finance Made Civilization Possible.