AnOnyxMouseCoward responded:
I stand corrected then. But in practice, almost every public company operates this way. Is every C-level executive and BoD member a diagnosable sociopath? I don't believe so. But they clearly believe that profit matters more than their employees livelihood, or some vague societal threat. They feel a pressure to put profit first, and we need to change that. Perhaps we need more activist shareholders that demand better corporate responsibility, but people like that tend to not have the money...
You are correct that virtually every publicly-traded corporation in the developed world is managed to maximize short-term shareholder return. That's because the curriculum of pretty much every MBA school is predicated on the Chicago School's economic philosophy - which is to say, "on Milton Friedman's philosophy." So their graduates are basically trained to be sociopaths. And they enter a business culture that has spent more than 40 years marinating in that stuff.
That's why virtually all of them believe the myth that they're legally obligated to transfer the maximum possible amount of corporate profits directly into shareholders' pockets, rather than spend any appreciable portion of it on things like research and development, computer security, employee benefits, and the like. MBA schools teach them that those things are "cost centers," so the amount of short-term shareholder return that's diverted to pay for them must be ruthlessly minimized. And the fact that C-suite performance bonuses almost exclusively take the form of massive blocks of discounted stock options means that executives personally profit from focusing on quarter-over-quarter increases in shareholder return.
So, of course, that's exactly what they do.
I strongly agree with your contention that that pervasive managment culture needs to change. But I see little chance that a sufficient number of activist shareholders can be convinced to fight for that - especially given that the legislatures and attorneys general of oil states like Texas, Oklahoma, and Louisiana have already come out swinging against the emergence of interest on the part of some of the largest wealth management firms in incorporating ESG principles into their investment strategies.
The only long-term solution, however, is for MBA schools - especially the big guys like Harvard, Yale, and Stanford - to stop teaching the sharholder primacy myth to their students, and to turn to a more balanced philosophy of business management.
Sadly, I'm not exactly holding my breath for that to occur ...