The juxtaposition of two editorials in a mainstream broadsheet makes interesting reading. The one argues that Gordon Brown’s advocacy of a tax on global financial transactions, the so called Tobin tax, suggests that the British government has, at long last, given up its slavish adherence to ‘the ideology that believes in deregulated, untaxed, ever-expanding global capital markets as an end in themselves’. The other argues that ‘China must be held to account for its political repression’. The connection between these two lies deep within the aforementioned ideology.
Category Archives: Corporate Ownership
Different forms of ownership, public limited company, co-operatiuves and various forms of co-ownership.
Earning the £Bn Bank Bonuses
Justification of bank bonus payments proceeds apace. Despite having in effect gone bust last year, and being only rescued as a publicly quoted company because the Labour Government was so paranoid about nationalisation, the directors of the Royal Bank of Scotland now wish to set aside £1.5Bn of tax payers’ money for next year’s bonus payments. Their argument is that unless the bonuses are paid, their most talented people will leave and they won’t be able to recruit in this highly competitive field. But it’s been said before that it was precisely these individuals who broke the bank. So why should the tax payer worry if they leave and aren’t replaced?
The Financial Reporting Council’s Complete Horlicks
The Financial Reporting Council (FRC)’s latest publication, “Proposed Reforms to the UK Corporate Governance Code”, is rather a waste of time. Changing an ineffectual and irrelevant code, even though at considerable expense to the tax payer, is hardly a matter of huge importance. And when the changes themselves are so slight they will have no impact at all on what is done, the significance is disappearingly small. But perhaps that was the intention.
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Cadbury and the Rape of Britain's Real Economy
Cadbury’s future as a British owned confectionery manufacturer seems doomed, for reasons discussed in ‘The Rise and Fall of Management’. Cadbury’s management may well have sought to fulfill their legal corporate duty, as defined in the 2006 Companies Act, to have regard to the company’s long term future and to the interests of employees and other stakeholders rather than just the shareholders. But, despite the law, shareholders’ interests are widely held to be paramount, and in the face of a hostile takeover bid, management are driven to simply maximizing the price that can be obtained for Cadbury shareholders. In the frenzy of this battle to the death, they most probably have little time for anything else, least of all making chocolate.
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Fighting for Fairness by Remaking the Real Economy 