Reconsidering the Social Responsibility of Businesses

In a speech in July, Democrat presidential nominee Joe Biden said: “It’s way past time we put an end to the era of shareholder capitalism. The idea the only responsibility a corporation has is with shareholders, that’s simply not true. It’s an absolute farce.” The Business Roundtable, an association of chief executives representing many leading U.S. companies, retreated from “shareholder capitalism” a little over a year ago, with a statement signed by 181 CEOs “who commit to lead their companies for the benefit of all stakeholders — customers, employees, suppliers, communities and shareholders.”  This sounds good in theory, but what are the benefits?  What are the risks?  And what does this debate mean for America’s managers, investors, workers, and consumers?  We’ll show you.

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