shareholders might be in a better position to hold managers accountable
But to whom? You can't assume shareholders agree on what this means, so you're introducing a layer of politics into the board elections. I'm not sure that's a good thing.
You could say the same about buisnes management- shareholders will disagree on strategy. But the current solution to that is the "business judgement rule" that says boards have wide-ranging protections so long as they're acting in good faith. You'd have to assume the same sort of thing would be adopted for charitable decisions - the "charity judgement rule", if you will.
And now you have a board with wide freedoms on business decisions and on non-business decisions. In other words, you have a board who can do pretty much anything they want outside of outright fraud. That is not exactly inspiring corporate governance for would-be investors or would-be do-gooders.
shareholders might be in a better position to hold managers accountable than donors to a non-profit are
That was a comparative statement. You're right, it may be difficult for shareholders to sue the management even if they make inefficient or even self-serving decisions. But lawsuits are not the only means by which people can hold other people accountable. Shareholders have the right to fire the management, in addition to the right to withhold further investment. Donors to charities only have the latter right.
So I'm only disagreeing with your claim #2 that charities are more accountable than these new types of corporations. Too many charities are run in an unaccountable way because the directors are accountable to nobody but themselves.
> But to whom? ... [snip] ... you're introducing a layer of politics into the board elections.
Politics happens everywhere, including for-profit corporations and non-profit charities. There's no escaping it.
But to whom? You can't assume shareholders agree on what this means, so you're introducing a layer of politics into the board elections. I'm not sure that's a good thing.
You could say the same about buisnes management- shareholders will disagree on strategy. But the current solution to that is the "business judgement rule" that says boards have wide-ranging protections so long as they're acting in good faith. You'd have to assume the same sort of thing would be adopted for charitable decisions - the "charity judgement rule", if you will.
And now you have a board with wide freedoms on business decisions and on non-business decisions. In other words, you have a board who can do pretty much anything they want outside of outright fraud. That is not exactly inspiring corporate governance for would-be investors or would-be do-gooders.