Who is the modern “shareholder”? Is it only an individual who holds shares of a company? Is it any business or person who is affected by that company’s decisions and actions? Or is it both?
Business Roundtable (BRT), a group of 181 chief executives, may have the answer. On Monday, the organization announced it had redefined its “Statement on the Purpose of a Corporation” to include the promotion of “an economy that serves all Americans.”
“Each version of the document, issued since 1997, has endorsed principles of shareholder primacy – that corporations exist principally to serve shareholders,” the organization said in a press release. The “standard for corporate responsibility,” however, has changed — and now demands that companies benefit “all stakeholders,” including customers, employees, suppliers, and communities. Through a modern lens, the members of this wide-ranging group could, in some ways, all be considered “shareholders” to some degree.
“The American dream is alive, but fraying,” said Jamie Dimon, chairman and CEO of JPMorgan Chase & Co. and chairman of BRT. “Major employers are investing in their workers and communities because they know it is the only way to be successful over the long term."
It's a win-win, because corporations are people, too.
But I agree, if more than window-dressing it's great. I've often wondered what the end game is for some of these corporations (and individuals)--they have tons of money, but their customer base is too poor to buy their products? Really idiotic, short-sighted views in most corporations right now, IMO.
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U.S. companies are concerned about President Donald Trump’s threats to ban them from doing business in China, and they’re poised to halt new investments if the trade war escalates, the leader of group of top chief executive officers said.
U.S. company executives get worried when they hear talk from Trump about invoking emergency powers on trade, said Josh Bolten, president and chief executive officer of the Business Roundtable and a former chief of staff to President George W. Bush.
“He has a lot of authority through the national security statutes to disrupt trade and commerce in a way that would cause huge damage -- not just to the Chinese economy, but to the global economy and the U.S. economy,” Bolten said Sunday on CBS’s “Face the Nation.”
White House economic director Larry Kudlow downplayed Trump’s China threat, saying on CBS that the president doesn’t intend to try to block investment in China right now and that “maybe the way it was phrased was a little tougher than usual.”
“He’s asking American companies to take a look, take a fresh look at frankly moving out of China,” Kudlow said.
Still, Bolten said the Dow Jones Industrial Average’s 623-point tumble on Friday in response to Trump’s threat -- while also increasing the tariff rate on $550 billion in Chinese goods -- was a sign of investors “tapping the brake lightly.” A lot of U.S. businesses are “poised right on top of the brake” on new spending if the trade war isn’t resolved, he said.
“The risk is that everybody’s going to slam on the brake, and that would be a disaster — not just for the Chinese, but for the United States as well,” Bolten said.
