Last weeks Economist’s Schumpeter column addressed an issue close to me. The drive to maximise shareholder returns has been a theoretical and real obstacle to companies choosing to ‘be, and do, good.’ The argument is that owners have a right for the company to be managed with their interests front and centre.
The column cites studies published in a new book called Firm Commitment by Colin Mayer which argues that the overstatement of the ‘boosting shareholder gains function’ misunderstands the nature of the firm. In an analysis of possible new ways of operating, his preferred approach (rather than increasing CSR efforts) is reportedly to instil longer term thinking in governance by mechanisms such as constituting ‘trust companies’ where Boards are obliged to manage the company affairs with a long term view. Indeed. But that long-term thinking needs to be informed by an overall purpose, and that overall purpose is most meaningful when associated with a long term, public good aspiration.
I was struck by how little long term planning we do when listening recently to Radio National’s 24/02/2013 Future Tense podcast in which Anthony Fennell interviewed someone who is part of a hundred year project (yep you read right) to explore neighbouring solar systems. Now there is a fine line between being a true visionary and a crackpot. It reminded me of Aubrey de Grey’s TED talk on how close we might to human beings living to 1000 years. The point is that some people seem to have the capacity to imagine a different world, rather than one that simply extends the trajectory of what we currently experience in incremental steps. These people operate on the margins of society. We need to listen to them, even if with a critical posture. They might well be ahead of their time, rather than simply out of step. Think Galileo.
Makes my aspirations feel pretty puny.