[thesuitonym]

>What happened to being a forward thinking and innovative company?

Google went public is what happened. You literally cannot make good decisions when you have to base everything around what will make the most profit for the shareholders this quarter.

[linguae]

I’m sometimes cynical about publicly-traded companies, but Google seemed more forward-thinking in its pre-Alphabet era, and Apple seemed to be very forward thinking from 1997-2011 when Steve Jobs was running the company. Being a publicly-traded company doesn’t automatically mean resorting to bean counting and other bad forms of management.

[thesuitonym]

You're absolutely right that being public doesn't automatically making bad choices--but it does eventually mean making poor choices. As long as you have a strong CEO, they can weather the storm of shareholder requests, but once you get to third or fourth generation leaders it typically becomes a race to the bottom. See: Every company in every industry.

[bboygravity]

Can you explain what things shareholders generally request?

As far as I know the only duty a company has towards shareholders is "protect them" (aka: don't mess up and make money). As long as the company eventually does that there is no issue. Even if it takes 8 quarters to become profitable (or 10+ years, see Amazon).

There are probably ways in which shareholders can get together and request something (in court?), but that almost never happens? Maybe I'm wrong. If so, would love to see examples.

[jaggederest]

Look at the history of activist investors like Carl Icahn. They will happily start a proxy war to oust management to wring the last cent out of a company, or file a minority shareholder lawsuit alleging all kinds of malfeasance to tank the stock to be able to buy up a controlling interest. The 80s M&A boom had all kinds of crazy things, and it makes recent history look somewhat mild by comparison.

These days the vast majority of executive comp is in stock - imagine if bad optics could force you to take a 60% pay cut, you'd be pretty conservative with your choices.

[astrange]

Investors in Google (or Meta) don't have voting rights. You simply can't do any of that stuff. All you can do is not invest, which means the price doesn't go up, but that hasn't been happening.

[cameldrv]

They do have the right to sell the stock.

If too many of them do, the stock goes down, and essentially everyone at the company (especially the executives) take a pay cut. The executives aren't even just thinking about their own pay. The entire company's ability to attract and retain talent depends on the stock price going up.

[eftychis]

See my other "sibling" comment. As an owner/shareholder you have duties owed to you by Google.

If a too good offer comes by, for instance, for one to buy Google:

the offer has to be disclosed; and regardless if the founders like it or not -- or what the voting majority says, there is a price where the remaining shareholders can force Google to be sold.

[eftychis]

Well just to be complete there are enumerated duties to shareholders (the fiduciary ones):

1. Duty of Care

2. Duty of Loyalty

3. Duty of Disclosure

4. Duty of Confidentiality

5. Duty of Prudence

6. Duty of Good Faith

You can start looking at this rabbit hole here (and it is a rabbit hole): https://www.law.cornell.edu/wex/fiduciary_duty

P.S. Just a (fly-by)comment; not advice of any short or kind -- either investment or legal. P.S.2 Oh it does happen that share/stake holders seek enforcement for breach of fiduciary duties. I would say it is quite common.

[financypants]

Their duty is to keep revenue or profitability up and to the right. Every quarter that they don’t do this, analysts will grill the management team about what happened and what will change. The company is forced into a cycle, quarter by quarter, of underestimating earnings, outperforming estimates, and pleasing investors.

[epicureanideal]

Or they could grow a spine and declare they’re not playing that short sighted game.

[thesuitonym]

they could, and occasionally a few CEOs do this. It is not the norm, though.

[krackers]

I think you need someone with a steadfast personality like Jobs in order for it to work. Otherwise the CEO just ends up drifting in the wind trying to appease shareholders

[bananapub]

I'm sort of amazed how often I see this dumb take on HN.

just because it's a US tech-world cultural norm for companies to mostly be run in fucking stupid short term ways, it doesn't mean it's actually required. especially in the case of Google, where 1) Eric, Larry and Sergey have stiched up the entire board's voting power, 2) doesn't need to raise cash via bonds or stock at all and 3) it's a magic money tree, so investors will accept being told to fuck off and let the CEO run the company however they think it'll work best.

Google also IPOed in 2004...are you seriously suggesting that it hasn't been a

> forward thinking and innovative company

for ... 19 years? that's a pretty bold take.

[thesuitonym]

I'm sort of amazed how many times this exact reply was added to my comment. Did you read any of them? Of course it's not required. It's just what happens.

[dilyevsky]

Things weren’t like this for a long time after it was already public. I used to work there more than 5 years after ipo and their office environment (especially in zurich) was really good

[thesuitonym]

You're right, and I addressed this in another reply, but keeping a good company culture requires a very special leadership team, and it can't and won't last forever.

[htag]

* Eventually ownership will disperse from the core group of initial owners to investors in general

* As a larger ownership moves towards investors, decisions are made that sacrifice the special sauce in order to increase returns.

* Appeasing general investors leads towards enshittification.

Sometimes a strong leader (Jobs, Cook) can keep the investor class as bay for a period. Sometimes leadership can be consolidated for long periods of time to delay the process (Walton, Zuck), but it feels inevitable after IPO.

[ornornor]

They just did mass layoffs in Zürich too from what I hear. Many will be out of a job at the end of this month at that office.

[anlaw]

Reality isn’t fractal. People leaving for a variety of motives, expansion of some offices, closing others… chip away at the edge of known truth.

Entropy forces new relative perspective. Humans need to do better about accepting figurative and literal death and chill. There quite literally is nowhere else to go except insane from repeating ourselves.

A rewrite of philosophical priority is a necessity for anyone under 50 and the species. That has to be taken sincerely and seriously because, well they kind of outnumber the ossified pensioner, and if they’re staring down forced obligation to choke on fire smoke for 60 years or dump gramps overboard, no one around to see it happen will be around long enough to insure it’s a footnote in any discussion of history.

Self proclaimed STEM minded secular people seem just fine ignoring evidence that does not fit the civic life narrative they’ve been spoon fed like it’s immutable truth. Seems to have latched itself onto whatever quirk of biology religion accidentally exploited; like a nihilism cause it’s all gods plan kind of woo.

“Hey look at me, mom! My life goal is making computers do what they were intentionally designed to do!”

That can be automated; any acceptable experience is a finite set of constraints. DOOM is pretty DOOMy. Same for Halo. Email clients. But hey we have figurative career ambitions, man; Google Fellow! Boom goes the dynamite.

Smaller models first; let’s make an AI to replace the CEO by assigning project management to vetted candidates via publicly audited randomizer. Term limits for geniuses who always seem to end up enjoying their own farts.

“I’m sorry general manager of capital intense AI infrastructure, you are tonight’s… weakest link! dropped into literal shark tank”

It’s been a long day. Sorry not sorry for the more unhinged off gassing.

[ravst3s]

>You literally cannot make good decisions when you have to base everything around what will make the most profit for the shareholders this quarter

Ironically, Google doesn't care about their shareholders and quarters like other tech companies. They don't provide a guidance, their earnings calls have little substance, and their disclosure is atrocious.

[erehweb]

They don't have to do that, though - founders still retain control so could ignore shareholders.

[midoridensha]

It's sad: Google has (had?) all the ingredients needed to make an absolutely amazing tech company, but instead they've been consistently shooting themselves in the foot for at least a half-decade. They've had oodles of money, brilliant developers, majority stock ownership by the founders (to avoid being completely beholden to shareholders and their short-term interests), lots of goodwill and a great image at the beginning, and they're just squandering it all with terrible leadership.

[bbor]

Not quite - just because the founders have majority control doesn't mean that the BS financial duty "laws" don't apply to the company executives. They have a duty to all the shareholders, not just the controlling ones.

[layer8]

There is no duty to maximize profits though, that is a myth.

[bbor]

IDK I'm confused about that. I think we can agree that it's at the very least a myth that holds a lot of sway among many investors and executives.

https://www.nytimes.com/roomfordebate/2015/04/16/what-are-co...

  The leading statement of the law's view on corporate social responsibility goes back to Dodge v. Ford Motor Co, a 1919 decision that held that "a business corporation is organized and carried on primarily for the profit of the stockholders." That case — in which Henry Ford was challenged by shareholders when he tried to reduce car prices at their expense — also established that "it is not within the lawful powers of a board of directors to shape and conduct the affairs of a corporation for the merely incidental benefit of shareholders and for the primary purpose of benefiting others."

  Despite contrary claims by some academics and Occupy Wall Street-type partisans, this remains the law today. A 2010 decision, for example, eBay Domestic Holdings Inc. v. Newmark, held that corporate directors are bound by "fiduciary duties and standards" which include "acting to promote the value of the corporation for the benefit of its stockholders."

[thesuitonym]

They have no legal duty to do so, but why do people buy stock if not to produce a return?

[layer8]

Producing a return doesn’t imply maximizing that return. Short-term profit maximization may actually be detrimental to long-term success. People also buy stocks because they believe in what the company does in terms of meaningfulness, and that meaningfulness tends to decline when trying to maximize profits.

[HWR_14]

You don't have to base everything around what will make the most profit this quarter. Bezos certainly didn't feel compelled to in the early days of being public.

[tanepiper]

Yes. I love working for a company with no shareholders. We actually get time to look at the problem.