Thursday, 7 January 2010

Klaus Schwab's (of "stakeholder" theory) self-deception

In today's Guardian the world-renowned economist Klaus Schwab writes the following (LINK to article):
Almost 40 years ago, I developed the "stakeholder" theory for businesses. This considers the enterprise as a community, with a number of social groups connected directly or indirectly to the enterprise which are dependent on its success and prosperity. These of course include shareholders and creditors; but employees, customers, suppliers, the state and the society in which the enterprise is active are stakeholders. According to the stakeholder approach, the management of the enterprise acts as a trustee for all stakeholders . . . based on the principle that each individual is embedded in societal communities in which the common good can only be promoted through the interaction of all participants – and business success is also embedded in this interaction.
We have witnessed a gradual erosion of this communitarian spirit over recent years. This erosion of societal values has progressed particularly in the business world, and is also one of the primary reasons of the current economic crisis.
This is a classic example of the subconsciously operating self-deception used to rationalise and perpetuate the existing - inherently unjust, inhumane and unsustainable - socioeconomic order.
Those in positions of wealth, power and privilege are bound to maintain the illusion that they are SERVING society, rather than exploiting it, as they always have through out history, of course, and prehistory as well, no doubt.
Of course, many in positions of wealth, power and privilege DO serve society, to some extent, but as a shepherd serves his flock, which is not primarily for the flock's sake (notwithstanding any genuine concern he may feel for a lost or injured lamb), but for his own, and/or his employer's sake, for the meat and wool the flock provides and can be exchanged in the market place for money, the most versatile form of power, the pursuit and exercise of which is what Homo sapiens primordial struggle for survival and "success", perversely, in the artificial environment of human society itself, has largely been reduced to.

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