The latest global financial crisis has many interesting facets. All of these can be boiled down to frailties of human morality.
Perhaps most facets can be boiled down to reveal a major ingredient of greed. Greed is inherent in any situation where one person wants more than another person. Greed becomes particularly ugly and pernicious when one person not only wants more than another person, but also considers that they are rightfully entitled to more than another person.
Some people consider that they deserve a greater share of the limited pie because they needed to study hard for years to fit them for top jobs and positions. They may well have studied diligently for years to achieve formal qualifications, but there are two dominant reasons why they were able to do so. The first is that they may have been born into better financial and property circumstances than some others that they consider lesser. The second is that they may have been born with a greater capacity, either physical or intellectual or both, than some others that they consider lesser. In either case, their endowment was a fortuitous event that did not result from their own doing.
Many directors of companies (or corporations, as they are referred to in many places around the globe) feel that they are superior beings who deserve more than the average worker in their organisations. This is particularly so for CEO’s (Chief Executive Officers) of large corporations. It has become sickeningly common to hear news items of corporate heads being paid annual bonuses that amount to what would equal the total average annual salaries of fifty to two hundred of their workers. Of course, if the comparison were made with workers in Third World countries, it would be equal to many thousands of workers.
Directors of companies, and CEO’s, owe their prime legal duties to the shareholders of their companies. It is their duty to maximize profits for their investors. Apart from this, they have a legal duty to act within the laws of the states and countries where their companies operate. They have no obligation over and above these duties, to act in consideration of their customers, the public good within their operating nations, or the local or global environment. Within the frameworks of the corporate legislations around the world, it is often greed that prevents them from taking seriously, any duty to these other areas.
Bearing in mind the financial turmoil that is now evident, together with the ecological turmoil that is now evident with respect to species becoming extinct or endangered, forests being denuded, and global climate change, perhaps it is time that global thinking was brought to bear on the legal duties of company or corporation heads. Generally speaking, corporation legislations have grown in a piecemeal, ad hoc fashion that has perpetuated the thinking of the industrial revolution. Such thinking, and the support for notions of rightful and deserved entitlement that form part of it, have now served their time and are, in many respects counter to the overall good and welfare of the publics of this planet.
If governments were to have their perceived duties focused upon the citizens of their nations, and the environments of their nations and of the globe, they could make a positive start to world betterment and equity by simply writing into their corporation legislations, a simple, legally enforceable hierarchy of duties for corporation directors, including CEO’s (who act as de facto directors, at least.) An example of such a hierarchy of duties would be: 1) a duty of care to the environment; 2) a duty to the public good of their state and/or country; and the world; 3) a duty of care to their employees; 4) a duty of care to their customers/clients/and consumers; and 5) a duty to the interests of their shareholders.
Perhaps most facets can be boiled down to reveal a major ingredient of greed. Greed is inherent in any situation where one person wants more than another person. Greed becomes particularly ugly and pernicious when one person not only wants more than another person, but also considers that they are rightfully entitled to more than another person.
Some people consider that they deserve a greater share of the limited pie because they needed to study hard for years to fit them for top jobs and positions. They may well have studied diligently for years to achieve formal qualifications, but there are two dominant reasons why they were able to do so. The first is that they may have been born into better financial and property circumstances than some others that they consider lesser. The second is that they may have been born with a greater capacity, either physical or intellectual or both, than some others that they consider lesser. In either case, their endowment was a fortuitous event that did not result from their own doing.
Many directors of companies (or corporations, as they are referred to in many places around the globe) feel that they are superior beings who deserve more than the average worker in their organisations. This is particularly so for CEO’s (Chief Executive Officers) of large corporations. It has become sickeningly common to hear news items of corporate heads being paid annual bonuses that amount to what would equal the total average annual salaries of fifty to two hundred of their workers. Of course, if the comparison were made with workers in Third World countries, it would be equal to many thousands of workers.
Directors of companies, and CEO’s, owe their prime legal duties to the shareholders of their companies. It is their duty to maximize profits for their investors. Apart from this, they have a legal duty to act within the laws of the states and countries where their companies operate. They have no obligation over and above these duties, to act in consideration of their customers, the public good within their operating nations, or the local or global environment. Within the frameworks of the corporate legislations around the world, it is often greed that prevents them from taking seriously, any duty to these other areas.
Bearing in mind the financial turmoil that is now evident, together with the ecological turmoil that is now evident with respect to species becoming extinct or endangered, forests being denuded, and global climate change, perhaps it is time that global thinking was brought to bear on the legal duties of company or corporation heads. Generally speaking, corporation legislations have grown in a piecemeal, ad hoc fashion that has perpetuated the thinking of the industrial revolution. Such thinking, and the support for notions of rightful and deserved entitlement that form part of it, have now served their time and are, in many respects counter to the overall good and welfare of the publics of this planet.
If governments were to have their perceived duties focused upon the citizens of their nations, and the environments of their nations and of the globe, they could make a positive start to world betterment and equity by simply writing into their corporation legislations, a simple, legally enforceable hierarchy of duties for corporation directors, including CEO’s (who act as de facto directors, at least.) An example of such a hierarchy of duties would be: 1) a duty of care to the environment; 2) a duty to the public good of their state and/or country; and the world; 3) a duty of care to their employees; 4) a duty of care to their customers/clients/and consumers; and 5) a duty to the interests of their shareholders.
Crankyfella
1 comment:
Aw gee whiz Crankyfella, you done being a bit hard on the CEO's. Surely the dill in charge of Telstra (or whatever it is called this week) works hard enough to earn the thirteen and half million dollars a year which his shareholders give him. After all he is an American and we all know they know more about things than us.
As for the duty of care, I think that went out the window in 1996 when Howard became PM. The only person that he cared for was himself. The CEO's saw what he was doing and just followed his example.
The sooner the Liberal Party gets rid of the National Socialists within their ranks the better we will all be. Kevin Crud may not be much good but he is a whole lot more appealing than Malcolm Bulldust and the far right of the Liberal Party.
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