Half-Truths in Business

Memo To: CEOs



There is nothing clever about firing large numbers of people.

In our finance classes, we are teaching a view of the world that says that each of us is obsessively self-interested and intent on maximizing personal gain. Economic Man, we tell our students, has one goal: more. And to get more, each of us is willing to do anything…. In fact, the essence of real leadership and responsible management is the ability to judge the difference between short-term calculable gains and deeply rooted core values.

Imagine a company that puts its shareholders first – only to discover that it has alienated its customers…. Customers recognize the cynicism of a company that only sees them as dollar signs.

We used to say that corporations exist to serve society. After all, that was why they were originally granted charters — and why those charters could be revoked.

In 1999, the number of billionaires (in the U.S.) had increased to 268 — and the number of people living below the poverty line had increased to 34.5 million. A recent UN survey of the world’s wealthiest countries ranked the United States highest both in gross domestic product and in poverty rates….at the height of a decadelong economic boom, one in six American children was officially poor, and 26% of the workforce was subsisting on poverty-level wages. More than 30% of U.S. households have a net worth ( including homes and investments ) of less than $10,000.