companies in the top 100 companies , compared to 27 for Germany , 31 for France , and 40 for Japan in 2023 . China ’ s state-owned enterprises have meanwhile claimed the top spot from the U . S .
Nonetheless , advocates of U . S . corporate structure highlight the flexibility and adaptiveness of U . S . companies compared to European and Asian firms , which are often viewed as less innovative . Additionally , they contend that this system has contributed to higher GDP growth than other developed countries , while several EU states maintain high unemployment rates . It is also argued that U . S . companies have navigated recent challenges like the COVID-19 pandemic and the Russian invasion of Ukraine better .
U . S . companies have of course benefited from various factors such as the size of the domestic market , geopolitical influence , and status of the U . S . dollar as the world ’ s reserve currency , attracting global investment . However , they have become enamored by short-termism driven by investors . By 2020 , the average holding period of shares on the New York Stock Exchange had shrunk to roughly five months , compared to an average of eight years in the late 1950s . Shareholders can easily sell their shares without sacrificing any assets in the company , hindering long-term strategic planning .
Frustration with the persistent dominance of shareholders in the U . S . corporate world has prompted efforts to diminish their influence in recent years . In 2018 , Democratic senators proposed the Reward Work Act and the Accountable Capitalism Act , which would require large companies to allocate 33 to 40 percent of board seats to worker-elected representatives . These proposals mirror the German concept of board-level codetermination , adopted in the post-WWII era and now popular in many European countries .
Some contend that the German-style codetermination model is a poor fit for U . S . corporations . Moreover , codetermination initiatives have primarily focused on facilitating discussions between workers and employers on immediate conditions , serving as a supplement to existing union representation and collective bargaining structures rather than radically strengthening worker influence .
One advantage is the flexibility granted by U . S . state law , enabling states to experiment with their own rules . On April 19 , 2024 , the Volkswagen plant in Chattanooga , Tennessee , voted to unionize after two failed attempts in 2014 and 2019 . The decision not only brings representation to Volkswagen workers in the U . S . but also represents the first successful unionization effort at a non-Big Three ( General Motors , Stellantis , and Ford Motor Company ) auto plant in the South . And since the first unionization push in New York in 2021 , 41 states now have at least one unionized Starbucks , reminiscent of a century ago when labor movements gained significant momentum .
Policy recommendations have also emerged . Corporate Social Responsibility emerged originally in the mid-20th century but then reemerged by the turn of the millennium .
Environmental , Social , and Governance considerations then emerged by the 2010s , alongside Diversity , Equity , and Inclusion ( DEI ) initiatives . At a 2019 American Business Roundtable resolution , 196 CEOs advocated for a change in business culture and to commit CEOs to “ meeting the needs of all stakeholders .”
Despite increasing calls for corporate accountability , these endeavors often lacked enforceability . DEI initiatives in particular have become embroiled in political controversies , leading to companies backtracking on their commitments . Shell meanwhile faced pressure from activist shareholders in 2021 regarding its contributions to climate change , including from its largest institutional investors , Vanguard , BlackRock , and State Street . But as economic considerations took precedence , minimal pressure was put on Shell , resulting in negligible advancements in climate change initiatives .
Nonetheless , just as the rise of communication networks in the 20th century allowed investors to gain influence over corporations , the rise of the internet and social media has equipped stakeholders and grassroots activists with their own tools . Public pressure to raise the minimum wage has resulted in dozens of cities and counties increasing their minimum wage in recent years and compelled companies like McDonald ’ s to stop lobbying against it . The GameStop stock saga of early 2021 meanwhile demonstrated how retail investors , fueled by social media hype , drove the company ’ s stock price upward , threatening institutional investors by disrupting established market dynamics .
Institutional investors like Vanguard , BlackRock , and State Street , which all own major shares in one another , have helped lead to an immense concentration of corporate ownership . Failing to reduce their dominance , and shareholders in general could inspire further reforms . Limited Liability Companies emerged partly in response to this dominance , with the first established in Wyoming in 1977 . Meanwhile , large companies like OpenAI and Stripe are opting to remain private , further reducing the power of shareholders .
Additionally , worker cooperatives , businesses owned and operated by employees who share in decision-making and profits , have experienced renewed interest in the U . S . Despite waning popularity after their initial rise in the 19th century , they began to rebound in the 1970s and 1980s . The founding of the United States Federation of Worker Cooperatives in 2004 has since helped expand the number of worker cooperatives in the country .
Benefit corporations , for-profit companies that prioritize both their societal and environmental impacts , have also seen significant growth in recent years . Maryland became the first U . S . state to enact laws providing for public benefit corporations in 2010 , and has since been joined by 36 other states and Washington , D . C .
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