Corporations No Longer Putting Shareholders First

[Frodo]

This is a potentially huge shift compared with what has been the status quo for more than three decades now:

Maximizing shareholder value can no longer be a company’s main purpose: top CEOs

The heads of nearly 200 U.S. companies said Monday they are committing to a move away from the idea that the main purpose of a company is to maximize shareholder value, marking a break with a long-held conviction.
 
The Business Roundtable, a group of chief executives that was formed to promote pro-business interests, said it is shifting its statement of the purpose of a corporation to include all of its stakeholders, including employees, suppliers and broader society.

The group, which is currently led by JPMorgan Chief Executive Jamie Dimon, previously promoted the idea made famous by economist Milton Friedman that companies’ primary purpose is to reward shareholders.

[Vittorio]

Even if one hundred percent of the profits accrued by corporations were plunged back into "the community", those profits would still have to be generated via surplus value extraction. The problem with capitalism is intrinsic to the point of production, not with issues of distribution.

[John Dule]

Even if one hundred percent of the profits accrued by corporations were plunged back into "the community", those profits would still have to be generated via surplus value extraction. The problem with capitalism is intrinsic to the point of production, not with issues of distribution.

Surplus value does not exist. It is a measure of the risk run by the property owner when his assets are sunk into a mode of production. While a worker can move to another company if his employer becomes unprofitable, the employer will need to settle his outstanding debts, which means his risks and potential rewards are both much higher than the worker's. Risk has monetary value, and it's pretty appalling that Karl's followers haven't figured that out after over a hundred years of developing their """economic theory."""

[parochial boy]

Ignoring the business-school-101 abstract theorising for a moment (in 201 you learn about the present value of future cashflows and net present value and the like, fascinating stuff...), what CEO's say to make themselves feel good is broadly irrelevant.

As long as the market structures that exist continue to exist, then companies will have to prioritise shareholder value above all else. Simple logic being that if they don't, then that present value of future cash flows that analysts so treasure will decrease; meaning the share price decreases; meaning a direct blow to the wallets of key decision makers within the business, and some pretty unpleasant meetings with the board of directors. And then, even if you wanted to, say, pay your suppliers more quickly; you can bet someone else would refuse to, and they would win and you would lose cos they would have more cash to spend.

So don't believe a word of this, it's all marketing guff. Even if big business genuinely wanted to be "nicer", the way that modern day capitalism is organised rules it out as a possibility

[McNukes™ #NYCMMWasAHero]

Are they going to stop paying dividends to stockholders now or what? This is just pandering.

[Fmr. Pres. Duke]

Some companies are increasing wages from rock bottom levels, but corporate payouts and buybacks are at all time highs after the tax cuts. Companies are still taking care of their shareholders. Dimon is just pandering as he does so well.