The Milton Friedman Doctrine Is Wrong. Here’s How to Rethink the Corporation. | Evonomics

We all wonder about the overcompensation of Chief Executive Officers. Find out how the explosion of CEO pay happened and why today’s CEOs quickly acquire wealth, virtually risk-free, as shareholders. Unfortunately, for the rest of us, the corporate shareholder model tanks the economy and exacerbates inequality. Here Susan Holmberg and Mark Schmitt advance the much more brilliant corporate stakeholder model…

SOURCE: Evonomics

“Until we rethink our deepest assumptions about the corporation, we won’t be able to master the challenge of excessive CEO pay, or the inequality it generates. Is the CEO simply the agent of the company’s shareholders? Is the corporation’s only obligation to return short-term gains to shareholders? Or can we begin to think of the corporation in terms of the interests of all those who have a stake in its success—its customers, its community, and all of its employees? If we take the latter view, the challenge of CEO pay will become clearer and more manageable.” ~ Susan Holmberg and Mark Schmitt

Advertisements