The blonde Online Casino

[tikay]

Not sure I swallow the 'Absolute obligation to shareholders' argument either. How do certain moral obligations become void when one is part of an organization with shareholders? When was that rule ever written down? Do the big Fag companies have an absolute moral obligation to peddle cancer sticks to Third World Kids?

I'm just interested in this 'absolute obligation' thing..

Tikay's believes in a Thatcherite style free market whereby the only responsibility a company has is to maximise profit.

This creates problems for him because his belief in the ruthless power of the market clashes with his character and his idea of social responsibility.


(He's a pinko in disguise)

Well I may or may not believe in a Thatcherite style free market, that's irrelevant. What is relevant is Company Law, which in the case of a PLC, requires no concession to moral obligations in pursuit of maximising profits. That was my point, not what my belief was.

This creates problems for him because his belief in the ruthless power of the market clashes with his character and his idea of social responsibility.

That sums up my position absolutely & precisely.

Pinko? May be, maybe not......

[TightEnd]

It is the Duty of every British plc, enshrined in ther lst Companies Act, to have a statement of Social Responsibility. No PLC, in whatever industry, seeks to maximise earnings at the expense of all its stakeholders

[fearisthekey]

yer, I'm certainly not having a pop. It's just that I've studied this matter in great depth (by that I mean I've watched 'Thank you for Smoking', twice), and am interested to know where things stand on all this. I did work for a big blue chip once, I'll never forget the VP's memo that ran 'do not be under the illusion that this company exists for any purpose other than to maximize the profits for shareholder value'.
Interesting debate, I shall keep a close eye for the opinion of those infinitely more qualified to speak on it than I.

[tikay]

PLCs also have moral obligations, and they make decisions that can reduce the profit they could have otherwise earned.

For example the building of a dam might affect people living in the area, so a company has to either locate their operations elsewhere (at a higher cost), or maybe even relocate the indigenous people to another place where they can live safely.

They will & do build their dam or airport or whatever, where ever it's most cost-effective unless Instutional Investor Pressure or public/Government lobbying such that it becomes long-term -ev comes into play. How do you think Petroleum refinery & storage complexes come to exist in residential areas, waste-disposal plants ditto, or that tobacco Companies continue to make their death sticks? Because they have a fiduciary responsibility so to do. Their shareholders approve of such action!

"Social Responsibility" clauses are one thing, but if it was really the case, rather than just a sham token statement for the wets, how do tobacco compsnies survive? Because the responsibility to maximise earnings over-rides it.

[totalise]

I'll never forget the VP's memo that ran 'do not be under the illusion that this company exists for any purpose other than to maximize the profits for shareholder value'.

lol yes you see that a lot when the directors have stock options written into their contracts

[byronkincaid]

PLCs also have moral obligations, and they make decisions that can reduce the profit they could have otherwise earned.

For example the building of a dam might affect people living in the area, so a company has to either locate their operations elsewhere (at a higher cost), or maybe even relocate the indigenous people to another place where they can live safely.

They will & do build their dam or airport or whatever, where ever it's most cost-effective unless Instutional Investor Pressure or public/Government lobbying such that it becomes long-term -ev comes into play. How do you think Petroleum refinery & storage complexes come to exist in residential areas, waste-disposal plants ditto, or that tobacco Companies continue to make their death sticks? Because they have a fiduciary responsibility so to do. Their shareholders approve of such action!

"Social Responsibility" clauses are one thing, but if it was really the case, rather than just a sham token statement for the wets, how do tobacco compsnies survive? Because the responsibility to maximise earnings over-rides it.

I think there are a few countries that haven't yet made methamphetamine illegal. Probably be some profit in that.

[TightEnd]

"Social Responsibility" clauses are one thing, but if it was really the case, rather than just a sham token statement for the wets, how do tobacco compsnies survive? Because the responsibility to maximise earnings over-rides it.

they survive because there is a stable (and in some markets growing) demand for their product. This allows them to generate a lot of cash and reward shareholders handsomely

Doesn't mean they don't have a Social responsibility statement though, they have to have one.

this isn't secondary to maximising earnings. If it was earnings would be higher

[tikay]

It is the Duty of every British plc, enshrined in ther lst Companies Act, to have a statement of Social Responsibility. No PLC, in whatever industry, seeks to maximise earnings at the expense of all its stakeholders

Yes, it exists, just as a statement of ethnic equality exists in our institutionally racist Police Forces, or a Statement of equal treatment for Disabled Employees or pregnant women exists in every Private Ltd Company - not because they believe in it, or want it, but because they are obliged to state it. Fudging it is the easy bit.

[ifm]

Plus tobacco companies fund most of the bloody government!!!!
So you could argue the more profit they make the more hospitals get built

[TightEnd]

thats a very cynical view, albiet understandable.

The vast majority of UK corporate directors take their social and non profit responsibilites seriously.

[fearisthekey]

Plus tobacco companies fund most of the bloody government!!!!
So you could argue the more profit they make the more hospitals get built

Good post.
Smokers/ex smokers should get Absolute NHS priority. They've coughed up enough for it.

[TightEnd]

thats a very cynical view, albiet understandable.

The vast majority of UK corporate directors take their social and non profit responsibilites seriously.

tikay's view, not ifm's. which has some truth to it!

[tikay]

"Social Responsibility" clauses are one thing, but if it was really the case, rather than just a sham token statement for the wets, how do tobacco compsnies survive? Because the responsibility to maximise earnings over-rides it.

they survive because there is a stable (and in some markets growing) demand for their product. This allows them to generate a lot of cash and reward shareholders handsomely

Doesn't mean they don't have a Social responsibility statement though, they have to have one.

this isn't secondary to maximising earnings. If it was earnings would be higher

They do paragraph one, & fudge paragraph two, you well know that Rich! It would be impossible to market tobacco products otherwise. The fact that a demand exists means they will supply it, ethical or not, "Social Respohsibility" statement notwithstanding.

If "earnings could be higher", they would be.

[fearisthekey]

I like Microsoft and Bill Gates. Despite their imperialism and crap products, at least you know that a bit of what you buy is stopping some third world kids dying at 3 months.

[tikay]

thats a very cynical view, albiet understandable.

The vast majority of UK corporate directors take their social and non profit responsibilites seriously.

I am sorry, but that kite don't fly. They have to please the City, & the Institutions, & only profit matters. They simply pay lip-service to their social obligations - until & unless, of course, it affects their share price. Then they become all socially responsible & cooey-wooey.