| The big problem with corporations (as far as I see it) is that they act as a dehumanising mechanism for representing shareholders. An individual who has tight control over a company (like Elon Musk) can shoot for long term goals in order to achieve their noble aspirations. However, in most cases, the legal obligation of the directors of a corporation to represent the interests of their shareholders seems to default to purely financial interests. A board of directors aren't really obligated to represent the humanitarian or altruistic interests of their shareholders. In fact, typically financial interests are only served in the short term. This means the capital that a shareholder represents is only ever set to work to meet financial interests. It's up to the shareholder to then divert their profit from their own investments into charities. This seems very inefficient to me. My solution is to include a much richer mechanism for representing shareholder interests locked into the company charter. Shareholders could vote on what things they valued, and on values that they assign to those things. Then, instead of a quarterly bottom line that represents monetary value, the bottom line would also include those externalities that the shareholders voted on. For example, you could have a company where most investors were patriots who cared about the economy. They could vote to assign a value to every month of employment that the company provides to an American worker. So, when the bottom line was calculated, each full time worker was treated like an extra source of income. This means when the board of directors considers whether or not to close down a factor and outsource to Mexico, the reduction in costs has to justify the expense to the patriot virtues of the investors. The obvious objection is that if you only valued jobs you might run a company into the ground. However, running the company into the ground also gets rid of all the jobs. So it's not something the board of directors would want to do. Balancing short term gains over long term company growth is something directors have to do anyway. This example really illustrates the power of this approach. In our current system, a company can move a factory to Mexico even if all its shareholders want to keep jobs in the USA. Those shareholders could then earn a significant amount of dividends from the move, and then try to invest those dividends charitably in order to express their patriotic virtues. However, no charity is going to be able to replace all those lost jobs for the price of those dividends. Charities just aren't efficient and reliable enough. A valuable addition to the charter would be to make it so that the votes and results were made public. People who claim themselves job-creators would be able to put their money where their mouth is - and called to account if they failed to do so. |