The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-05-04
DO DIRECTORS pIRECT1

To THE Enron or THEsuN-Sfr; II should
not be, In country where the greater part o.
| All business transacted IL corporation Dust
ness, that there 10 conflict or disagreement
oe'Ween the Law of the land whether statue
law or Judge made law or common law ana
me actual transaction Of such corporate
business
Yet one constantly hears on every side,
| from those actively engaged In incorporated
business, that II II practically impo8siblo
efficiently and successfully 20 conduct such
business In literal and perfect compliance WIN
tb laws enacted 20 govern II.
The management Of a private or n partner
shlp business may he different from the pros
ecuton Of a business like banking. or IN
surahce. or production. or transportation
under charter OF incorporation given by the
state, which coRfers power on certain officials
70 10 certain things In a certain WY.
The claim Ia that the growth Of the pros
p~ity OF the country will he arrested. le
energies thWarted, and the safety OF tho
values OF it's industries endangered II always
and under every condition the letter Of the
law Ia TO be implicitly obeyed. Bank man
ayers, insurance managers and managers OF
production and transportation must, II 10
said, be permitted to decide when and 70
what extent their discretion can by them
selves be substituted for the letter Of the law
which In a crisis may be killing for every
body.
II In not Necessary 10 give examples Of the
KIND OF argument and pleading set up by the
energetic captains Of industries, 70 lushfy
their contention In behalf OF disregard, IN
stress, OF the laws under which, and under
which alone. the State has declared a business
or enterprise oan be legally carried on.
IL IL impossible TO think Of q corporation,
created by the State. without specification
by the State Of directors or trustees who are
TO conduct lie business, the methods By which
they are 10 he chosen, the powers they are 70
exercise and the formslltes Of such exercise
II IL impossible 20 think Of a director OF
trustee Of corporation without look
ing upon him as one who has accepted
personal trust from the state and the own
eTs OF the property invested In the corpor
alton, and yet one might infer from much Of
what one secs and hears nowadays that
the only duty OF such trustees IL 10 choose
executive officers and agents. and then throw
down the reins leaving the team Of subordi-
mates to 90 Rs II pleases The State dele
gates Us power 20 directors Of the corpora
ton; they delegate their power 20 officers they
select. and those officers delegate II again
TO the agents they appoint or recommend.
ShareoWners In the corporations are power
less because they have exhausted their rights
when they have Oh osen the directors who,
under the system Of proxy voting, can easily
perpetuate their control unless there shall be
such widespread dissatisfaction as IN in
duce shareOwners not to sell out but 70 hght
for change ~ management such as seems
TO he in progress at 100 Broadway IN this city.
one hears everywhere OF President this,
or Nice-President that. or an executive COM
mittce doing so and so. but little u heard Of
what the directors OF trustees do.
In Milwaukee, for example. there Ia activity
by the directors, but y began after the larceny,
II seems to have been impeTtectly exercised
for prevention.
IN the New York EQUITABLE company there
was little supervision and direction by tho
large and respectable body OF trustees.
Il has not yet been shown, In the pending
railway rate Investigation, that the railway
directors have been vigllAnt in studying. and
really dominating. the rates. rebates and dis
ordinations.
Are the laws AZ fault? HUDSON.
NEW YORK. May O.