Opinion | Hong Kong’s protests are just the tip of the iceberg: capitalism is in crisis across the globe
- The effects of ‘shareholder capitalism’, which prioritises profit, can be seen around the world, including in the dissatisfaction of Hongkongers. Can a responsible new business model, championed by leading US corporations, be a turning point?
While Hong Kong is embroiled in unprecedented social and political upheaval, a silent revolution is unfolding in the capitalist heartland of the world.
This is a significant milestone in the evolution of global capitalism. And it has a close connection to Hong Kong, via the late Nobel laureate Milton Friedman: the statement is a direct abandonment of the long-held notion by Friedman that businesses’ sole responsibility is to generate profit for shareholders.
In 1997, the Business Roundtable issued a statement endorsing “principles of shareholder primacy – that corporations exist principally to serve shareholders”. The new statement, instead, offers a “modern standard of corporate responsibility” serving all stakeholders.
This transition from “shareholder capitalism” to “stakeholder capitalism” is more than semantics.
For a long time, shareholder capitalism has been the unquestioned dogma of businessowners and management, and has shaped their decisions.