3.2 Unbundling Ownership
From wealth- to steward-ownership
When people talk about corporate ownership, the conversation usually focuses on who owns a company – founders, family members, foundations, the state, asset management firms, or institutional investors – while ignoring a more fundamental question: what does ownership actually mean, who should hold which rights and why, and how can it be structured?
Ownership as a bundle of rights
At its core, ownership is a bundle of rights attached by law to a particular asset. These rights can either be combined or separated. In the context of companies, two rights are especially important:
- Voting/ Decision rights: The power to exhibit ultimate control over the company.
- Economic rights: The right to personally access profits and value from the company.
In most companies, these two rights are bundled together by default. Shareholders who own shares typically have both the right to control the company and the right to capture the profits and realize the value it generates. This bundle is so familiar that many people treat it as natural.
But it is, in fact, a choice, and one with profound consequences.
The default model: wealth-ownership
Because voting and economic rights are usually issued together, a company becomes whether intentionally or not – a personal financial asset of its owners. Legally, any value created belongs to those who control it, reinforcing a model where maximizing shareholder wealth becomes the company’s default purpose. The company exists (legally) for the wealth of its shareholders, whoever that may be.
Unbundling the rights: ownership as stewardship
But you can also decouple the bundle of rights – separate money and power – and legally structure ownership as steward-ownership. This means that the company isn’t a financial asset of its shareholders anymore but that ownership is legally defined with control over the asset while value created serves the purpose of the company. The company exists legally for its purpose and is steered towards that purpose by its owners (stewards), whoever that may be.
Regardless of who owns a company, there are two primary forms of corporate ownership: corporate ownership as wealth-ownership, or steward-ownership. Both models are justifiable, depending on what you want to achieve. For some, the goal is wider wealth distribution that extends to employees or customers. For others, it's about locking in the company’s purpose and ensuring its mission can never be sold. It is important to match your intention with a coherent corporate ownership structure.