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Meaningful Metrics for a Smart Society
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Date: 2021-01-15 Page is: DBtxt003.php L070-PU-What-is-the-PURPOSE-of

TVM - TRUE VALUE METRICS
What is the PURPOSE of?
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WHAT DOES 'PURPOSE' REALLY MEAN?
Black Rock JP Morgan Chase World Economic Forum ExxonMobil
These organizations, and most others, have been pretty clear for many decades that the PURPOSE of a business organizations to make the maximum of profit for their investors ...
Anything else would be legally wrong!
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WHAT IS THE REAL PURPOSE OF A BUSINESS ORGANIZATION?
The conventional wisdom in some circles is that the purpose of business is to make profit, and if a business makes profit, then there will be an optimization of the economy and the maximum of benefit for society. This is the basic premise of the Adam Smith argument for a laissez faire market economy, and it has worked better for most of the last three hundred years than the alternatives.

The modern version of this argument is that business has to optimize its performance relative to the interest of the owners … the stockholders. Some executives have argued that to do anything else is a breach of trust and executives could be held accountable in law for their actions.

This idea has been challenged. Whether or not the law requires optimization of business for the benefit of stockholders, there are initiatives to make it clear that the 'purpose' of the business is to make a contribution to society using the resources of the business. One such initiative in the United States is the B Corp movement, which specifically has articles in the Bye Laws to ensure that social benefit is a legitimate goal of the business.

Whether or not there is a problem in law to do things that are valuable for society … for people and planet … the metrics of state, progress and performance may be structured so that it is possible to see what is going on and understand the implications.

Earning PROFIT has been the main PURPOSE of investor owned business organizations for a very long time ... though there is evidence that many of the biggest success stories have been for companies that conbined a great social purpose as well as giving return for the investors. For example, in the late 19th century, Lever Brothers (which eventually became Unilever) started as a business to produce low price soap to make it possible for poor people to wash themselves better and be more healthy.

SLOWLY, SLOWLY, THERE IS THE BEGINNING OF CHANGE ... MAYBE?
Black Rock Larry Fink JP Morgan Chase Jamie Dymon World Economic Forum Klaus Schwab ExxonMobil Darren Woods

Larry Fink of BlackRock made news in 2018 by talking about the idea that investors were interested in PURPOSE of a company as well as PROFIT. This made news ... but whether or not it had any substance remains to be seen!

Jamie Dymon got some press attention when he was Chair of the Business Round Table ... but his complete silence in anything related to the economic crisis of 2020 brought on by Covid-19 is remarkable ... he has done well for the stockholders in the company he manages, but as to the impact his company has had on society and the environment, it is pretty clear that there is a failing grade!

Klaus Schwab founded the WEF. The WEF has been very 'successful' over quite a long period, but it has tended to promote the agenda of the rich and famous much more than the billions of little people ... who have been studiously neglected by those with opower and influence.

Darren Woods has been CEO of Exxon since 2017. Exxon, the company has behaved in an appalling way with respect to issues like GHG emissions and climate change for decades, and there is little evidence yet that much is changing. This is appalling!

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