Obligations to Shareholders
In Tim Bray’s second post of opposition to Google AutoLink, he mentions that they owe it to their shareholders
to do one of two evil things. Now, neither of Bray’s suggestions may actually be in Google’s long-term interest, but they certainly are in its short-term interest.
The basic question is, does our culture really believe that a corporation’s highest obligation is to its shareholders? That is, are corporations out there solely to make money? If a corporation obviously sacrifices sort-term or even long-term profits in order to, say, make the internet a better place for everyone, does it open itself up to shareholder lawsuits, as Cryptonomicon suggests? Corporations and their shareholders receive from society significant advantages simply because they are incorporated. They should be expected to give up some profits in order to give something back.
As you say, corporate charity is often in the long-term best interest of the corporation. It’s also good PR, and certain kinds are also smart tax moves. More to the point, shareholders generally sell rather than suing, and I think Larry and Sergey can and will exercise their judgment and take that little hit.
Comment by Will Warner — 5/22/2005 @ 12:22 am UTC