Shareholders vs. stakeholders, and the purpose of a corporation
Marketplace All-in-One
Marketplace
4.5 • 1.4K Ratings
🗓️ 11 October 2023
⏱️ 24 minutes
🧾️ Download transcript
Summary
Today we’re checking in on what happened after almost 200 high profile CEOs signed a statement in 2019 promising to serve stakeholders like employees and consumers along with their shareholders.
Have those companies made any progress toward fulfilling those nonbinding pledges?
That’s the question Molly Kinder, a fellow at the Metropolitan Policy program at The Brookings Institution, and her co-authors wanted to answer by analyzing the decisions some of those companies made during the first two years of the pandemic.
On the show today, Kinder explains why the Business Roundtable statement made such a splash in 2019, why workers haven’t seen substantial gains since then, and how it’s connected to the latest wave of strikes.
Then, we’ll get into what schools run by the Defense Department can teach us about improving public education across the country. And some Federal Reserve officials think it’s time to cool it with the rate hikes.
Later, we look at the part of the crypto world that’s often overshadowed by grifters and a story of self-checkout woes. Plus, Charlie Sprinkman, founder of Everywhere Is Queer, answers the Make Me Smart question.
Here’s everything we talked about today:
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- “Profits and the pandemic: As shareholder wealth soared, workers were left behind” from The Brookings Institution
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- “Workers are striking across America for higher wages” from The Washington Post
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- “Who Runs the Best U.S. Schools? It May Be the Defense Department.” from The New York Times
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- Veteran Homelessness Fact Sheet from VA Homeless Programs
We want to hear your answer to the Make Me Smart question. You can reach us at makemesmart@marketplace.org or leave us a voicemail at 508-U-B-SMART.
Transcript
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| 0:00.0 | Hey everybody, welcome back to Make Me Smart, where we make today make sense. |
| 0:11.3 | That was Kimberly Adams. |
| 0:13.2 | That was Kimberly Adams, I don't know, I can't read words. |
| 0:18.1 | I on the other hand I'm not Kimberly Adams, I'm Kyle Rizal, it is Tuesday, today, the |
| 0:22.0 | 10th day of October. |
| 0:24.5 | So here's what we're going to do today, and we've to chat about this a little bit, I think |
| 0:28.9 | a couple of times on the podcast, we're going to dig into it today. |
| 0:32.2 | Four-ish years ago, a couple of hundred really high profile CEOs in this economy signed |
| 0:37.3 | a statement, promising to serve stake holders, people like employees and consumers, along |
| 0:43.8 | with their shareholders. |
| 0:46.7 | If you are at all familiar with Milton Friedman, you remember that the Friedman famously said |
| 0:52.2 | that a company's duty is to maximize shareholder value, and a point of fact that might not be |
| 0:57.8 | the best way to actually do business, I'm just saying. |
| 1:00.4 | So we're going to talk about that today. |
| 1:02.8 | Right, and these companies made a big to-do about signing this thing back in 2019, and we |
| 1:08.4 | just want to see how that's been going. |
| 1:10.9 | How that's been going, and how it might tie into the recent surge in labor movement activity. |
| 1:16.7 | So here to make a smart about this is Molly Kinder, a fellow at the Metropolitan Policy |
| 1:20.9 | Program at the Brookings Institution, where they focus on the labor market and low-wage |
| 1:25.8 | workers. |
| 1:26.8 | What's the show? |
| 1:27.8 | Thanks so much for having me. |
... |
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