Stakeholder Capitalism Needs Gov't Oversight To Work

Despite the urgent pressure of COVID-19 and other crises brought to us by 2020, stakeholder capitalism - the idea that corporations should take into account the interests of their stakeholders, not just shareholders - has remained at the top of the corporate news cycle.

On the recent 50th anniversary of economist Milton Friedman's essay "The Social Responsibility of Business Is to Increase Its Profits" - which established shareholder primacy as the prime corporate directive - many legal, business and economic leaders challenged Friedman's legacy, favoring stakeholder capitalism over shareholder primacy.

We think that it isn't an either/or situation. Stakeholder capitalism can work to benefit shareholders as well, but there must be collaboration between business and government in order to achieve the desired goals. In fact, a review of recent history shows us that collaboration between business and government is the optimal way to determine what is in the best