Other laws are more subtle, they provide a palette of colours to fill in the spaces, and it’s these that are frequently less obvious, even as they shade us all, embedded as they are in company law and articles of association.
Laws set courses of direction. Imagine a set of laws that required powerful businesses to put the interests of a small number of people before the interests of humanity and the earth. What would the direction and impact be?
Imagine such laws encouraging businesses to exploit people, and exploit all living things, and all natural things, extracting as much value from them as possible in order to maximise the profits for the owners of the company.
These laws would inevitably create a civilisation designed to consume the environment, populations, and then ultimately itself. Surely no-one in their right minds would actually propose a law such as this in today’s world?
A little history lesson. Stay with me.
Shareholder primacy, the idea that a corporation is only responsible for increasing shareholder value, was made popular by Nobel prize-winning economist Milton Friedman in the 1970s.
He argued that the only social responsibility of a business is “to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game engaging in open and free competition without deception or fraud”.
Of course it was a popular philosophy, it’s totally self-serving and allows businesses to give zero consideration to the impacts of their activities beyond the strip mining quest for profit. And here we are 50 years later, and that motherless idea born in the 70s and force-fed financial steroids for half a century is now a raging lunatic enshrined in law.
Maybe it was legitimate in its time, but times change, laws change, everything changes, and in 2021 the idea that business has no social responsibility is more worthy of a noble street protest than a Nobel prize.
Which is why the law must change. Clearly and obviously, the existing laws and ways are not fit for purpose. There is light, and every business and every individual should be welcoming and supporting of it in the form of a proposed legislative change and actually a commercial movement.
The Better Business Act will transform the way we do business, so that every single company in the UK, whether big or small, takes ownership of its social and environmental impact.
It will have the effect of making all businesses, from new-born start-ups to the giants and their grievesome footprints align with the new era.
The Better Business Act will change the game, from Milton’s game of short-term plunder into a long game of service, restoration, and generationally viable and sustainable business.
Many hundreds of businesses have signed in support of it. Do so, it’s time for a lot of things to change now. BetterBusinessAct.org.