One of the many flaws in the way big corporations are run is the way CEOs dominate the boards of directors they're supposed to be reporting to. Look no further than CEO Mayo Shattuck's tame panel of lackeys at Constellation Energy. Technically CEOs don't choose their directors, but they have effective veto power and frequently "suggest" "suitable" candidates to the nominating committee. Barry Ritholtz describes the phenomenon well in Bailout Nation.

Boards of Directors have historically been a collection of business associates, cronies and golfing buddies, with interlocking memberships between companies.

Board members are nominated by fellow insiders, effectively disenfranchising shareholders. This allows management to become ensconced, with little in the way of owner input into a company’s direction. Open competition for Board seats is difficult, even for large shareholders.

Now Bloomberg's David Reilly reports that Chris Dodd's financial-reform bill would allow shareholders themselves -- the owners! -- to decide who should run their companies. But, as Reilly notes, the proposal will be fiercely fought.

A prime example is buried deep within the 1,136-page, financial-reform legislation unveiled this week by Senate Banking Committee Chairman Christopher Dodd. It is a proposal to let shareholders nominate directors to corporate boards. The draft bill goes on to say votes for these positions shouldn’t resemble a Soviet-era election.

This isn’t radical stuff. Shareholders are the owners of companies and it is high time they have a greater say in how they are run. For years, though, corporate executives and their supporters have beaten back attempts to make boards accountable.