The private sector is often considered to be the heart of wealth creation and innovation — the late 1990s and early 2000s success story of Silicon Valley being a prime example. In this model, shareholder value is seen as the ultimate measure of a company’s success. Indeed, the idea that businesses are the most productive actors in the economy has served as a convenient justification for high incomes and great wealth.
Greg Mably
What Role Should Business Play in Society?
We must reconsider how value is created in capitalist economies.
September 19, 2022
· Long read
Summary.
Companies talk the talk of creating stakeholder value, but most don’t walk the talk. In this article, the author outlines two major reasons why — an insular financial sector and stock buybacks — and describes a new model for a truly symbiotic relationship among business, government, and citizens. For this model to succeed, business and government in particular need to address three key questions: What should we create? How should we evaluate social impact? And how should we share?