Jensen Shipping has four open seats on its board of directors. How many shares will a shareholder need to control to ensure that his or her candidate is elected to the board given the fact that the firm uses straight voting? Assume each share receives one vote.

Question

Business

Iliana

6 December, 20:11

Jensen Shipping has four open seats on its board of directors. How many shares will a shareholder need to control to ensure that his or her candidate is elected to the board given the fact that the firm uses straight voting? Assume each share receives one vote.

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Answers (2)

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Desiree Sims · Answer 1

50% plus one

Explanation:

There are two voting procedures used to elect the members of a board of directors: the straight voting method and the cumulative voting method.

The straight voting method favors majority stockholders since they receive one vote per stock per open seat which means that someone that has 50% plus 1 stock can actually get all the board members elected.

Cumulative voting system assigns one vote per stock for the whole election, that means that a board member could be elected with 25% plus 1 vote. This voting system favors minority shareholders since someone with 50% plus 1 vote could only get 2 members elected by himself/herself.

Carpenter · Answer 2

The shares needed by the shareholders is 50 percent of the shares plus one share.

Explanation:

Jensen Shipping has four open seats on its board of directors and uses straight voting system hence 50 percent of the shares plus one share is a shareholder need to control to ensure that his or her candidate is elected to the board.

In general straight voting system each shareholder is entitled to one vote per share hence the count would be normal by the number of directors to be elected.