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Statement on the Purpose of a Corporation

businessroundtable.org

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31–40 of 211 posts

Re: Statement on the Purpose of a Corporation

#31

Post by hn_throwaway_99 »

dev_dull wrote: post #28

Corporations are just people, the same as countries are just people. To think that they operate apart from the decisions of their leaders and members is just silly. There aren’t “good” and “bad” corporations. There’s good and bad leaders and members. I feel like there’s a strong shift happening in the US away from personal affect and responsibility and shifting it into legislative and corporate policies. The self is…

If corporations are 'just people', then we should be fine getting rid of all of the legal fictions that protect these individual people from the consequences of their actions.

Re: Statement on the Purpose of a Corporation

#32

Post by pessimizer »

wiremine wrote: post #23

You can be cynical about this, and a healthy amount of skepticism is warranted given the authorship. That said, it would be interesting (healthy?) to discuss/debate the merits of the actual statements: * Delivering value to our customers. We will further the tradition of American companies leading the way in meeting or exceeding customer expectations. * Investing in our employees. This starts with compensating them f…

They're incomplete in that all of the statements lack any falsifiable content. They're vapid, nonspecific, and obvious. This is clearly a PR exercise, possibly with the hope of publicly allying with one of the Democratic primary contenders, or a strong potential Trump challenger.

Statements about planned obsolescence, disposable plastic packaging, repairability or specific forms of rent seeking are examples of the kinds of statements that would be serious.

Re: Statement on the Purpose of a Corporation

#33

Post by RockIslandLine »

wiremine wrote: post #23

You can be cynical about this, and a healthy amount of skepticism is warranted given the authorship. That said, it would be interesting (healthy?) to discuss/debate the merits of the actual statements: * Delivering value to our customers. We will further the tradition of American companies leading the way in meeting or exceeding customer expectations. * Investing in our employees. This starts with compensating them f…

"This starts with compensating them fairly and providing important benefits."

So 51% of corporate profits are reserved for the employee bonus pool? And all employees are eligible for said bonuses?

It's not hard to come up with examples of where this fails. Don't give me aspirational pie in the sky. Give me operational policy.

Re: Statement on the Purpose of a Corporation

#34

Post by dougmwne »

...it is a tale Told by an idiot, full of sound and fury, Signifying nothing.

Public corporations are not going to stop being paperclip maximizers until we legally and economically force them to stop. This is absolutely nothing but an attempt to divert public anger away from any new regulation that would force companies to deliver more value to society and less to shareholders. Sadly, no different than greenwashing.

Re: Statement on the Purpose of a Corporation

#35

Post by dangjc »

cs702 wrote: post #17

This new purpose stated by the CEOs of America's largest corporations is a welcome change to the corporate ethos that has prevailed in the US since the "greed is good" days of the 1980's. It is also a preemptive response to the growing popularity of politicians like Bernie Sanders and Elizabeth Warren.

Let's hope it doesn't preempt real reform: giving employees and other stakeholders board seats.

Re: Statement on the Purpose of a Corporation

#36

Post by mauld »

These sorts of statements always scare me a bit. First, businesses are still required to give maximum benefit to shareholders.

Second, even if this was the goal of a business, it then leaves it up to businesses(boards?, CEOs?) to define things like "ethically", "important benefits", "diversity" etc. These aren't things you could get all people to agree on in the first place- hence the whole democracy thing we do. A lot easier to make these statements then turn them into policies.

Let businesses do what they do best - give them a set of constraints (laws) and let them maximize value. If they do "good" things as well, great, if not, fine. If we don't like the outcomes (environmental damage, inequality) change the rules to change the value equation.

Re: Statement on the Purpose of a Corporation

#37

Post by mlyle »

AtlasBarfed wrote: post #13

Wake me up when I can use such a statement as a means to legally coerce corporations into compliance with existing laws, to say nothing of the exigent environmental threats facing the world. Literally every CEO would laugh at this statement in the privacy of their office, while they engineer stock manipulation to trigger their stock options and retire in 5 years. It's like an ethics in business class at MBA schools.…

"Literally every". I don't think it's fair to tar every business owner and executive with this brush. Yes, there's unethical people, and it's way too common in this business environment. But there's also plenty of businesses that do their very best to treat customers, employees, suppliers, and shareholders with respect and fairness.

Re: Statement on the Purpose of a Corporation

#38

Post by analogwzrd »

wiremine wrote: post #23

You can be cynical about this, and a healthy amount of skepticism is warranted given the authorship. That said, it would be interesting (healthy?) to discuss/debate the merits of the actual statements: * Delivering value to our customers. We will further the tradition of American companies leading the way in meeting or exceeding customer expectations. * Investing in our employees. This starts with compensating them f…

If they're serious about decreasing the importance of shareholder value, then they'll re-design executive and management compensation to be tied less to the company stock price.

Re: Statement on the Purpose of a Corporation

#39

Post by excursionist »

manigandham wrote: post #19
n-exploit wrote: post #6

If corporations want to make a real change and provide value to all stakeholders, they will need to develop a practice to systematically eliminate all negative externalities (risk) being transferred to society. Unfortunately, the current regulatory environment still makes this illegal/impossible, given that executives are still legally bound to create value for shareholders. The thoughts and feelings of these CEOs me…

Externalities are considered in shareholder value. It has never been just monetary, contrary to popular opinion.

How are externalities considered in shareholder value?

Re: Statement on the Purpose of a Corporation

#40

Post by afthonos »

mauld wrote: post #36

These sorts of statements always scare me a bit. First, businesses are still required to give maximum benefit to shareholders. Second, even if this was the goal of a business, it then leaves it up to businesses(boards?, CEOs?) to define things like "ethically", "important benefits", "diversity" etc. These aren't things you could get all people to agree on in the first place- hence the whole democracy thing we do. A l…

Gestures like this, sometimes even coupled withe genuine action, are what businesses do to avoid those explicit constraints being created. "Look, we're being reasonable, no need to force us to."
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