Book Review – Jim Wright
Completing Capitalism: Heal Business to Heal the World
By Bruno Roche and Jay Jakub
“How much profit should a company make?” This is a question which started the global food and beverage company, Mars Inc, on an interesting journey of corporate discovery. In Completing Capitalism Roche and Jakub describe the journey so far.
In the early 2000s increasing numbers of people were questioning whether business, the financial sector and indeed the western economy were showing signs of losing their way – of actually losing sight of their purpose. Excessive salaries for senior managers; investor shorttermism; private equity funds buying up companies, stripping out capital and putting them back on the market loaded with debt; the mis-selling of financial products: these were just some of the practices causing concern about the way capitalism was heading.
Since the early 1970s the established orthodoxy of economics, initially expressed by Milton Friedman and developed by the Chicago School of Economics, was that “the one and only social responsibility of business is to maximise the profits for shareholders.” But a contrary view, which could be summarised under the heading impact investment, began to emerge in the early 2000s. Its essential postulate is that business needed a broader view than that expressed by Friedman and his supporters, namely, responsibility for its impact on the additional three areas of stakeholders – employees, communities and the environment, as well as the generation of healthy profits. The financial crash…
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