Once again this arrives at the same time as I’m hearing about references to the same subject the wider world. Friedman has a lot to answer for.
Interestingly, many of the behaviours exhibited by these larger companies are absent in much smaller companies. The alignment and engagement is more tangible, possibly due to a shorter feedback time between action and consequence.
Thanks Ian. Certainly proximity between action and consequence is a factor in many of the things that corporates in particular do. That’s almost verbatim one of the observations I’m making in the chapter I’ve been working on for the past few weeks… connecting how people feel to business outcomes which is incredibly challenging in complex systems.
Great write up. Didn't know that a court decided what business is supposed to be for. And explains a lot of the unsustainable practices prevailing in the US and spilling over to the rest of the world. I guess we need a couple of court cases challenging that "jurisprudence" and making social and environmental responsibility part of what a business is for. I've always said it won't take hold until we make it part of the balance sheets and profit and loss statements. Now, I understand we need one more thing for it to become reality: and that's to make it part of the legal stuff around business.
Thanks Marjan, the original version of this chapter (which you can still find on here and Linkedin) took a much simpler line about how the whole shareholder primacy story was just that… a story. In many respects, I still hold that view, but what this rewrite aims to do is demonstrate that, like most things, it’s a little more nuanced than that. The court case was only a local one, but it was enough to provide the evidence for those seeking it. Friedman’s paper was only an opinion, but again, it proved useful for those seeking credence for their viewpoint.
Once again this arrives at the same time as I’m hearing about references to the same subject the wider world. Friedman has a lot to answer for.
Interestingly, many of the behaviours exhibited by these larger companies are absent in much smaller companies. The alignment and engagement is more tangible, possibly due to a shorter feedback time between action and consequence.
Thanks Ian. Certainly proximity between action and consequence is a factor in many of the things that corporates in particular do. That’s almost verbatim one of the observations I’m making in the chapter I’ve been working on for the past few weeks… connecting how people feel to business outcomes which is incredibly challenging in complex systems.
Great write up. Didn't know that a court decided what business is supposed to be for. And explains a lot of the unsustainable practices prevailing in the US and spilling over to the rest of the world. I guess we need a couple of court cases challenging that "jurisprudence" and making social and environmental responsibility part of what a business is for. I've always said it won't take hold until we make it part of the balance sheets and profit and loss statements. Now, I understand we need one more thing for it to become reality: and that's to make it part of the legal stuff around business.
Thanks Marjan, the original version of this chapter (which you can still find on here and Linkedin) took a much simpler line about how the whole shareholder primacy story was just that… a story. In many respects, I still hold that view, but what this rewrite aims to do is demonstrate that, like most things, it’s a little more nuanced than that. The court case was only a local one, but it was enough to provide the evidence for those seeking it. Friedman’s paper was only an opinion, but again, it proved useful for those seeking credence for their viewpoint.