Sunday, August 10, 2014

Reich on stakehold and shareholder capitalism

In this article Reich wonders if stakeholder capitalism is making a comeback. There was a time when companies generally took all stakeholders into consideration, meaning not just shareholders but employees, customers, the environment and the community at large. The B-corp is structured so that a company can do exactly that, and to date over 500 have so organized. 27 States have also created 'benefit corps' for the same purpose.

60 years ago this was more the standard way of doing business. Then in the 80s it became more about hostile takeovers, skyrocketing executive salary, destroying unions, abandoning communities, squeezing employees for more work with less pay or just firing them: all in the name of just one bottom line, profit. Hence the decline of a healthy economy for all with an increasing wealth inequality gap unparalleled since the last great depression.

Perhaps the return of stakeholder capitalism is a response to this. Or perhaps it's an indication of the values that underlie it, the sort of values that are inherent to the next economic phase in our evolution, that of the Commons. It seems more like a transition stage from capitalism on the way to something far better. And already well underway, just under reported in the capitalistic-fed media.

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