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This is a common myth, but is false. Direct quote from the Supreme Court: > “Modern corporate law does not require for-profit corporations to pursue profit at

• pessimizer 2y ago
  It's not a myth. The person you are replying to did not say that corporate law requires companies to prioritize profit. Coroporations need to prioritize profit because that's what they're for. Whenever it looks like a company is not prioritizing profit, what you're seeing is the employees and owners of a corporation using it as a tool to express their personalities and preferences. This is usually not good, it is corruption. There's no reason to think that the personalities and preferences of arbitrary employees and owners are good, or that they would tend to do good things. The idea that companies have moralities, and that besides bringing in profit they also have some hazy duty to do things that I agree with personally is the myth. It's self-regulation propaganda. It's better to just have rules that keep companies from doing the things that we don't want them to do, instead of hoping that they will suddenly realize that money doesn't buy love, and that the only important things in life are health and family. That's not what they're for. That's what you're for. They're not real people.
  • wizzwizz4 2y ago
    > Coroporations need to prioritize profit because that's what they're for. I disagree. Corporations do things (e.g. provide goods and services): that's what they're for. The whole "money" thing is just a means-to-an-end: a system of accounting to allow the corporation to continue to do what it's supposed to do. Money, after all, is inherently valueless: it's only worth anything because it can be exchanged for goods and services. If powerful entities exist solely for making money, we risk the economy becoming completely decoupled from anything that actually matters.
    • tcfhgj 2y ago
      > If powerful entities exist solely for making money, we risk the economy becoming completely decoupled from anything that actually matters. welcome to reality
• touki_ 2y ago
  Interesting opinion, but slightly besides the point made here. Nobody here said it was "legally had to", did they?
  • decremental 2y ago
    It's common for people to say things like that and throw in the phrase fiduciary duty. That's what's being referenced here.
• sega_sai 2y ago
  I don't think the supreme court opinion matters in my opinion. I think it is the question of incentives. We should not be surprised if companies optimize for profits, especially if they are owned by shareholders who mainly care about profits. Because of that it is unreasonable (in my opinion) to rely on goodwill. We should instead ensure the regulations are such that unacceptable behaviour is not allowed.
  • zinekeller 2y ago
    Yeah, one point-of-view is Japanese companies and (mainly) American activist investors. Japanese management are usually cautious in their dealings and store (activist investors think it's hoarding) money, but activist investors are pressuring them to act faster and to operate on a relatively-lean budget.
• charles_f 2y ago
  It's not a problem of regulation but a problem of market capitalism. Executives in public companies are voted in by shareholders (even if so indirectly by the board). Shareholders seek return on their investment by increase in the value of their shares, which is directly linked to the revenue and profit of the company. As a CEO of a public company, if you're not ready to do what increases profit, you will get replaced by someone who will. The main reason why it won't be profit "above everything else" is when there is a risk that the "above everything else" reduce either of profit or market cap: potential legal ramifications, bad press, etc.