# Political Compass #16: Shareholder profit is a company's only responsibility. **URL:** \ **Category:** Great Debates\ **Created:** [April 28, 2004, 9:48am UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454 "2004-04-28T09:48:47Z")\ **Posts on this page:** 9\ **Page:** 4
**Author:** ![SentientMeat](https://avatars.discourse-cdn.com/v4/letter/s/43a26b/32.png) [@SentientMeat](https://boards.straightdope.com/u/SentientMeat)\ **Post date:** [April 29, 2004, 8:06pm UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454/61 "2004-04-29T20:06:44Z")
If a group makes a decision, does resposibility for the consequences of that decision not reside with that group even though a “group” is an abstract entity? ---
**Author:** ![Cheesesteak](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cheesesteak/32/3694_2.png) [@Cheesesteak](https://boards.straightdope.com/u/Cheesesteak)\ **Post date:** [April 29, 2004, 8:35pm UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454/62 "2004-04-29T20:35:30Z")
I clicked agree on this one (I think i was a 0 / -1 or so) but maybe I’ll have to say disagree now. The reason is that I don’t necessarily believe “profit” is the only thing shareholders care about. Companies should follow the directives of their shareholders and do that which is in the shareholders best interest. I came to this idea by thinking about my father’s small business. Large businesses are really nothing more than inflated small businesses, their responsibilities don’t change with size. My father’s business is over 30 years old, and he has a grand total of 3 people working in the shop, including himself. If profit was his primary goal, he would have at least 2-3 more people working there, trying to pump out more business. Profit is not his primary goal, not at 67 years old, it isn’t. He wants security and a stable income, not maximum profits. With a small workforce he can easily weather downturns in business, he doesn’t have to fire people if work is slow, and he gets his steady income. A company has great responsibility to its shareholders, they are the very purpose of its existance in the first place. Whether that responsibility is to purely maximize profit is questionable. ---
**Author:** ![John\_Mace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/john_mace/32/185_2.png) [@John\_Mace](https://boards.straightdope.com/u/John_Mace)\ **Post date:** [April 29, 2004, 9:59pm UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454/63 "2004-04-29T21:59:19Z")
> [@SentientMeat](#): > > If a group makes a decision, does resposibility for the consequences of that decision not reside with that group even though a “group” is an abstract entity? It resides with the individuals of the group. That may sound like a semantic triviality to you, but it does relate to this issue. If I were to say that a corporation has some social responsibilty, I’d have to say that every individual has that same responsibility. And yet, I think many poster here think that corporations, _qua_ corporations, have some social responsibilities above and beyond what individuals in society have (eg, suppling someone with a job). > [@cheesteak](#): > > A company has great responsibility to its shareholders, they are the very purpose of its existance in the first place. Whether that responsibility is to purely maximize profit is questionable. True, of course, but is that a \*\*SOCIAL \*\* responsibility? ---
**Author:** ![SentientMeat](https://avatars.discourse-cdn.com/v4/letter/s/43a26b/32.png) [@SentientMeat](https://boards.straightdope.com/u/SentientMeat)\ **Post date:** [April 30, 2004, 9:33am UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454/64 "2004-04-30T09:33:45Z")
> [@](#): > > **John** : \*If I were to say that a corporation has some social responsibility, I’d have to say that every individual has that same responsibility. \* And I would agree in spades, noting that the consequences of some individual’s decisions impact society far more than others. **_All_ individuals have responsibilities in addition to fiduciary profit.** If I find a tree blown down on a blind corner, I have a _social responsibility_ to report this safety hazard to the police. Likewise, those individuals on a company’s decision-making board have similar responsibilities to, _at least_, public safety, the environment and local heritage, especially since their decisions can have such dramatic consequences. (I agree that “providing jobs” is not necessarily their responsibility, but “preventing exploitation” certainly _is_). ---
**Author:** ![SentientMeat](https://avatars.discourse-cdn.com/v4/letter/s/43a26b/32.png) [@SentientMeat](https://boards.straightdope.com/u/SentientMeat)\ **Post date:** [April 30, 2004, 11:42am UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454/65 "2004-04-30T11:42:15Z")
Sorry, “All individuals have responsibilities in addition to _financial_ profit”. ---
**Author:** ![Blalron](https://avatars.discourse-cdn.com/v4/letter/b/35a633/32.png) [@Blalron](https://boards.straightdope.com/u/Blalron)\ **Post date:** [May 1, 2004, 12:39am UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454/66 "2004-05-01T00:39:36Z")
> [@John Mace](#): > > It resides with the individuals of the group. That may sound like a semantic triviality to you, but it does relate to this issue. If I were to say that a corporation has some social responsibilty, I’d have to say that every individual has that same responsibility. And yet, I think many poster here think that corporations, _qua_ corporations, have some social responsibilities above and beyond what individuals in society have (eg, suppling someone with a job). The workers whose labors the shareholders greatly benefit from should be treated with a modicum of respect. Why should corporations focus exclusively on giving benefits to those who supply them with their capital to the exclusion of those who supply them with their labor? ---
**Author:** ![John\_Mace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/john_mace/32/185_2.png) [@John\_Mace](https://boards.straightdope.com/u/John_Mace)\ **Post date:** [May 1, 2004, 1:00am UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454/67 "2004-05-01T01:00:58Z")
> [@Blalron](#): > > The workers whose labors the shareholders greatly benefit from should be treated with a modicum of respect. Why should corporations focus exclusively on giving benefits to those who supply them with their capital to the exclusion of those who supply them with their labor? It isn’t an either/or situation. Most corporations \*\*do \*\* treat their employees well-- because it is in the interest of their shareholders to do so. The stereotype of the tyranical CEO exploiting the workers is just that-- a stereotype. Do you have any data showing that most corporation do not treat their employees with “a modicum of respect”? ---
**Author:** ![Blalron](https://avatars.discourse-cdn.com/v4/letter/b/35a633/32.png) [@Blalron](https://boards.straightdope.com/u/Blalron)\ **Post date:** [May 1, 2004, 1:06am UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454/68 "2004-05-01T01:06:20Z")
> [@John Mace](#): > > It isn’t an either/or situation. Most corporations \*\*do \*\* treat their employees well-- because it is in the interest of their shareholders to do so. The stereotype of the tyranical CEO exploiting the workers is just that-- a stereotype. > > Do you have any data showing that most corporation do not treat their employees with “a modicum of respect”? Read “The Jungle” by Upton Sinclair. 😛 I’m not talking about data, I’m merely talking about the moral obligations of corporations. Perhaps most of them do fufill these obligations, although I’m sure some of them don’t. ---
**Author:** ![Jon\_the\_Geek](https://avatars.discourse-cdn.com/v4/letter/j/bbce88/32.png) [@Jon\_the\_Geek](https://boards.straightdope.com/u/Jon_the_Geek)\ **Post date:** [May 1, 2004, 10:06pm UTC](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454/69 "2004-05-01T22:06:54Z")
**Jon the Geek** (econ -2.88, soc -7.49) ticked _disagree_. However, after reading this thread and giving it some thought, I’ve moved to _strongly agree_. Companies have a responsibility to make a profit for their shareholders. Society has a responsibility to make things that are morally wrong unprofitable (through fines and boycotts). I think the current problems come from a failure by **society** to hold up its end of the deal. [Previous page](https://boards.straightdope.com/t/political-compass-16-shareholder-profit-is-a-companys-only-responsibility/242454.md?page=3)