COVID-19

The increasingly urgent issue of social value

Download a PDF of this article

Companies strive to balance profitable growth and a positive contribution to society.

In recent weeks, the coronavirus pandemic has brought the social dimension of business to the fore. The crisis is severely testing the claims of many companies that they are committed to the needs of numerous other stakeholder groups along with their primary obligations to their shareholders. Some observers are already asserting that the pandemic and the resulting expansion of the state’s role in the economy have decisively shifted the debate on the conflicting objectives of shareholder value and stakeholder value in favour of the latter. This conclusion may be somewhat premature, pending further evidence. However, the crisis is making it apparent that public opinion is highly sensitive to corporate activities perceived as contrary to prevailing notions of fairness and morally appropriate conduct. The public outrage at the suspension of rent payments by major corporations after years of excellent profits is just one example. Another is the discussion on whether companies that have been using a substantial share of their excess liquidity for share buybacks should be eligible for state aid. In addition, public lenders are demanding that bailout measures be made contingent on a temporary suspension of dividends or the general elimination of management bonuses.

Related Articles

January 26, 2022

Oversight and Investigations Informer – January 24, 2022

NOTABLE DEVELOPMENTS What We Are Watching:  CONGRESS CONSIDERS ANOTHER ROUND OF COVID RELIEF FUNDING: Democratic leader...

January 26, 2022

IR Monitor – 26th January 2022

Investor Relations News With Unilever facing criticism from long term investors, we begin this week with a reminder of t...

January 25, 2022

FTI Consulting Appoints Patrick Tucker to Lead Strategic Communications’ M&A and Activism Practice in the Americas