Question

The reason most states either permit or require the use of cumulative voting when electing directors is to:

a. allow directors to have a greater input into the election process.
b. reduce fraud among voters.
c. allow minority shareholders a greater chance at representation on the board.

Answer 1

c. allow minority shareholders a chance at electing a director

Step-by-step explanation:

When you have a certain percentage of ownership in a company, the company usually will grant you with the power to vote for the directors that will run the company.

The number of votes that are given to you will be larger if you have more percentage of the company. This make the majority owner of the company have more chance/influence at electing a director.

In cumulative voting , you can separate the total number of votes that you have and divide it to different candidates at the same time. With this form of voting, the votes given by the majority shareholders can be separated through several candidates. This make their voting power become smaller and the minority shareholders can have higher chance to win if they allocate every little ownership that they have into one candidate.