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Statement on the Purpose of a Corporation

businessroundtable.org

91–100 of 211 posts

Re: Statement on the Purpose of a Corporation

#91

Earlier quoted context omitted.

> Don't give me aspirational pie in the sky. Give me operational policy. See, there are three layers of decision making: vision, strategy, and tactics. You set large aspirational goals first (eg Microsoft "empower every person and organization on the planet to achieve more"), then smaller component strategies ("build the a cloud provider that integrates business intelligence into everything you do"), then the concret…

Why would all of these CEOs from random companies even be in the same room? In a free market leadership doesn't exist that high, companies aren't supposed to coordinate at that level.

“People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”

― Adam Smith, The Wealth of Nations

Re: Statement on the Purpose of a Corporation

#92
post #49

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 statement was more of a signal to the American people. It's up to us to vote and make the policy decisions to make this possible. As Noam Chomsky often says, even if a CEO wanted to do the right thing, they can't because of the structural constraints. They would be fired so fast. So it's up to us to change those constraints.

He is correct. I don't know why you are getting downvoted.

Re: Statement on the Purpose of a Corporation

#93
Do you want every American to benefit from your corporation? Spread >50% of shares (with voting rights) to every American, and make sure they have an efficient way to pool their votes, and are represented on the board.

Want your corporation to be environmentally friendly? Give a significant amount of shares (again, with voting rights) to an environmental NGO.

Yes, that means giving up control, but it will work.

Re: Statement on the Purpose of a Corporation

#94

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.

I agree that operational policy is important, but you're not going to get that (and you don't want it, necessarily) from the Business Roundtable. Rather, you'd want each company to execute on that kind of policy and share experiences.

It is easy to be skeptical here (and I am), but I think it would be folly to disregard the attempt as mere public relations fodder and instead see this as a starting point and continue to follow-up to ensure they're meeting their stated goals. If it's clear they're not, then happily disregard :)

Re: Statement on the Purpose of a Corporation

#96

Earlier quoted context omitted.

"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.

Should 51% of losses come out of employees pockets?

losing $1000 hurts a huge amount of people more than a billionaire losing a billion does.

How many billionaires are homeless after their ventures implode?

Re: Statement on the Purpose of a Corporation

#97

Earlier quoted context omitted.

> Don't give me aspirational pie in the sky. Give me operational policy. See, there are three layers of decision making: vision, strategy, and tactics. You set large aspirational goals first (eg Microsoft "empower every person and organization on the planet to achieve more"), then smaller component strategies ("build the a cloud provider that integrates business intelligence into everything you do"), then the concret…

Why would all of these CEOs from random companies even be in the same room? In a free market leadership doesn't exist that high, companies aren't supposed to coordinate at that level.

[deleted]

Re: Statement on the Purpose of a Corporation

#98
It's a nice statement but as long as shareholders can sue corporations for not maximizing value regardless of externalities, the purpose of a corporation is defined de facto rather than de jure.

Joel Bakan's book The Corporation (and the documentary of the same name) lay out this case well.

Re: Statement on the Purpose of a Corporation

#99
My father is from a generation where, from the day he got hired to the day he retired, 45 years later, he worked for the same employer. That changed in the 1990s.

That changed in the 1990s because companies no longer valued long term commitments. The famous example is IBM laying off, in bulk, countless long-term employees in the interest of increasing their bottom line.

The only way I was able to get a pay raise in the tech industry was by changing jobs. Once I figured that out, I changed jobs about once a year to triple my salary. On the way of doing this to climb the corporate ladder, I saw a lot of unethical behavior:

I saw countless dot-com startups dissolve after all of the executives gave themselves as big of a golden parachute as possible; I had consultants tell me to put experience I never did on my resume; I saw a company closing shop without paying their employees their final paycheck; I saw (and still sometimes see) hucksters promising good work and “exposure” but saying they could not pay you “for the time being”; I see companies demanding extensive experience (the infamous “ten years of React” job posting -- keep in mind React has been around for under seven years) but never offering on-the-job training; I have seen people who have developed injury or disabilities interfering with their work being “laid off” without warning; I have seen big tech companies refusing to hire anyone outright and cut off contracts short in the interest of maximizing CEO pay and shareholder value.

In short, I have become cynical about the tech industry and how it treats employees. Sure, it’s a living wage, but they won’t hire you if you mention “work life balance” during the interview; they expect long hours from their employees and expect the company to become their passion or life. No wonder why fewer people in America decide to give birth to and raise kids; it’s just not possible with the insane hours tech companies expect from their employees.

Yes, I’ve become quite cynical about the tech industry. It chews up workers and spit them out. The happiest memories of my life are not being in some cubicle in some office making too much money, but the times in my life when I took a break from tech and supported myself as an English teacher in another country, and had time to actually make real world friends and be able to date normally. Those are the times I cherish; that and the time I spend with my beautiful daughter.

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