Apple backs move to make corporations accountable to citizens, not shareholders
Apple is one of over 180 major companies to sign a statement from the Business Roundtable saying that corporations need to focus on fair trading, ethics and responsibility instead of solely on shareholder returns.
Tim Cook has joined Michael Dell, Amazon's Jeff Bezos, and 180 other CEOs in signing their companies to a new pledge by the Business Roundtable. The organization, formed in the 1970s to promote business, is seeking to "modernize" the purpose of corporations. Specifically, it wants corporate CEOs to stop seeing shareholder's profits as their sole indicator of success.
"Businesses play a vital role in the economy by creating jobs, fostering innovation and providing essential goods and services," says Business Roundtable in a statement. "If companies fail to recognize that the success of our system is dependent on inclusive long-term growth, many will raise legitimate questions about the role of large employers in our society."
This position may have arisen because of increasing pressure to break up large companies, in particular technology ones such as Apple, but it also represents that latest of the organization's forty years of statements on corporation ambition.
Since 1978, Business Roundtable has been regularly producing what it calls Principles of Corporate Governance, which set out to define what a corporation is, and to provide a goal for a CEO to aspire to.
"Each version of that document issued since 1997 has stated that corporations exist principally to serve their shareholders," continues the statement. "It has become clear that this language on corporate purpose does not accurately describe the ways in which we and our fellow CEOs endeavor every day to create value for all our stakeholders, whose long-term interests are inseparable."
Consequently, the organization's updated document states that corporations should look instead to how they deal with their employees, their suppliers, and the communities where they are based.
"While each of our individual companies serves its own corporate purpose, we share a fundamental commitment to all of our stakeholders," it says.
Those individual companies include the likes of Apple and also its supplier Corning, plus Amazon, and Dell. Other familiar American giants are on the list too, such as The Coca-Cola Company, and Exxon Mobil.