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So I don’t know, one thing that is personally a bit disheartening…. It bums me out that people immediately go to “You must be doing this to make money.” Because
by orblivion 16y ago
So I don’t know, one thing that is personally a bit disheartening…. It bums me out that people immediately go to “You must be doing this to make money.” Because that’s just so different from the ethos of the company. It is so different from how we actually think about stuff that you feel so misunderstood.
It's pretty sad that people think that someone should or ever would run a huge operation without money being a major factor, and it's even more sad and also insidious that Mark is playing along with this fallacy himself.
- tedunangst 16y agoMoney can be a major concern to a huge operation without being its primary focus. Money is a big deal for the Red Cross, but the Red Cross doesn't exist to make money.
- klochner 16y agoThe Red Cross is a non-profit. facebook has a legal obligation to maximize shareholder value: Whereas for-profit organizations exist to earn and re-distribute taxable wealth to employees and shareholders, the nonprofit corporation exists solely to provide programs and services that are of self-benefit.
- celoyd 16y agoNo, it has a legal obligation to do what (the majority of) its shareholders say. If they tell it to dance a jig and give all its assets to the Flat Earth Society, it’s obliged. Maximizing shareholder value in the way that’s usually meant is a business school doctrine, not a legal doctrine. (Edit: on second thought, it is a legal doctrine, just not the legal doctrine.) See, for example, http://www.virginialawbusrev.org/VLBR3-1pdfs/Stout.pdf http://www.virginialawbusrev.org/VLBR3-1pdfs/Stout.pdf : “Dodge v. Ford is a mistake, a judicial “sport,” a doctrinal oddity largely irrelevant to corporate law and corporate practice. What is more, courts and legislatures alike treat it as irrelevant. […] Only laypersons and (more disturbingly) many law professors continue to rely on Dodge v. Ford.”
- klochner 16y agoIf they go public as expected, I'm doubting many equity holders will be interested in a jig. I stand by my observation that a non-profit is poor evidence for the assertion "Money can be a major concern to a huge operation without being its primary focus"
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- tedunangst 16y agoSo it's not legal for a for-profit organization to donate to charity?
- klochner 16y agoOf course it's legal, it could be great PR.
- tedunangst 16y agoBut the money donated would likely generate better returns if reinvested in the business (or even just regular advertising), so it's not maximizing value. Lots of companies exist to make money, sure, but it's possible for a company to exist where that's not the raison d'etre.
- robryan 16y agoNot really, the goodwill can't be measured but it's likely to generate better returns in the long run.
- klochner 16y agoThis thread feels like the twilight zone. How do the actions of the red cross, a non-profit organization, provide any evidence that for-profit companies don't act in a profit-maximizing way?
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- nostromo 16y agoI believe he's being honest. Money is important -- but there's a point at which you can buy anything you've ever wanted that it seems to become less so. I've seen it to a much lesser extent with an old boss of mine. Think about Warren Buffet. He could buy anything he ever wanted decades ago. If he was doing it for the money, he would have quit a while ago. Instead he marches on, doing what he enjoys doing.
- ArabGeek 16y agoI agree that it is "sad that people think that someone should or ever would run a huge operation without money being a major factor" but if Mark did wrong or not is something else.