Source:http://blogs.ubc.ca/adamseston
Adam Seston’s blog post from early September illustrates how it is necessary for a business to be responsible to the community for it to even survive in today’s markets, let alone flourish and prosper. He is absolutely correct.
I also believe that this outlook is absolutely inefficient and overly idealistic.
Sure, it’s great that companies have excellent PR, and that they know how to hold hands with minorities and community leaders, but frankly, if I am a shareholder in a business, their responsibility to me is not to be the friendliest, most eco-sensitive, community-orientated firm of the day that everyone loves. A company that I have put my faith and financial capital into should spend it’s every moment creating innovative, efficient, effective and long term ways to make me, the shareholder, money.
In the days of John Pierpont Morgan, banker and financier in 1920’s Wall Street, there were practically no rules. Firms fought tooth and claw for every percent of market share, and a lot of people got hurt by this blatant disregard for ethics. But oh boy, did they make money. Their profit margins were legendary, and the investor that were lucky enough to hitch onto firms like Standard Oil or J.P Morgan in the early days emerged fabulously rewarded for their confidence.
I’m not calling for a return to the doggy-dog world of of the Roaring 20’s, I am asking a simple question: have we gone too soft? Have our emotions impeded a firm’s ability to get a bit of moral dirt under it’s nails to keep itself afloat and keep us earning our just dividends? Only the future will tell.