Here’s what I was always told: When you buy stock in a company, you become a part-owner of the firm. However, since you can’t spend your time running the company, you delegate your authority to a group of corporate directors, whom you and other shareholders elect. And to paraphrase former General Motors Chairman Charles Wilson, “What’s good for shareholders is good for the company,” right?

Well, it all depends who you ask. In producing NBR’s "Trouble at the Top" special (which will air this Friday), I learned that this conventional wisdom is not universally accepted. In fact, it is the subject of a major dispute between some of the biggest experts on corporate governance.

Attorney William Savitt of Wachtell, Lipton, Rosen and Katz goes so far as to say that “shareholders don’t own companies in a formal sense.” Savitt claims they’re mere holders of corporate securities -- and just one of many constituencies that the Board of Directors must consider in determining what’s best for the company. In light of that,
he thinks that making it easier for outsiders to run for Board seats (forcing existing directors to face challengers) is a bad idea.

On the other hand, America’s best-known shareholder activist, Carl Icahn, couldn’t disagree more. He told Susie Gharib that, at present, “there is very little corporate democracy” -- and he says that’s the reason why huge waste and “reprehensible” executive pay packages are endemic on the corporate scene.

Icahn says under the current system, corporate directors “are all buddies with the CEO.” (Incidentally, Icahn thinks the typical CEO is “not the brightest guy in the world,” although he does admit there “are a few good CEOs around.”) And he says that unless you can finance a very expensive proxy fight, as he can, there is no way to change the composition of the Board and make management accountable.

Icahn draws support from a very high-powered academic: Lucian Bebchuk, director of the corporate governance program at Harvard Law School. Bebchuk says his research has documented that corporate directors generally run for election unopposed. He says that’s effectively stripped stockholders of their right to vote. And Bebchuk says that leaves no “accountability mechanism” at companies that underperform.

So while the 2008 Presidential election is getting the lion’s share of press attention this year, it’s too bad that more attention isn’t going to corporate elections. In our Good Friday program, “Trouble At The Top,” we’ll try to shed a little light on this important matter.