Strange things happen once the mince pies start to settle, just after you've finished seething at the Queen's speech and set the kids up with the latest Disney. This year a cousin and I began to debate what we'd change following last year's global bust -
and in doing so we defined our vision of Post-apocalyptic new capitalism – which I'd like to share with you all.
First thing is changing the measure of corporate success. For this you need a couple of metrics:
1. How many people do you employ
2. How well are they treated
3. How little debt do you have
4. How much do you give back to the community that supports you
With these set, a successful company needs to employ as many people as possible whilst remaining profitable and relatively debt-free. But to be truly successful it needs to pay well and also route profit back into the community instead of to shareholders.
It would mean that CEO's would then be rewarded by growing their company instead of cost-cutting to boost profit - in fact having to lay off staff would be seen as a major error rather than a bid to boost EBITA and dividend.
Then we realised that stock markets are also a huge problem for companies that wish to take on board our new definition of success - after all, ploughing profit into employees and community leaves little for dividend. So why not close the markets? Why not
remove the notion of market-based share trading - but keep the good things like accounting transparency and debt ratings.
On this scale, my cousin, who is on the board of a taxi company that keeps around 200 people in work is a relatively successful person on a local basis. Indeed the British Queen who started this conversation, and in whose name millions of people are employed
(Armed forces, civil service, NHS etc...) and whom are comparitively well paid would be a successful person also. Yet Citi CEO Vikram Pandit, currently seen to be reeling in the excessive losses there would be viewed in a very different light - the axing of
52,000 staff would be a severe case of gross misconduct.
Already these sorts of definitions exist - indeed if a company in France has to lay off staff, the CEO must appear before a Judge and explain his actions - which could result in the CEO being declared incompetent to run the company. Can you imagine how busy
the courts would be in the US today if this was the case?
Anyhow, after we got that far it became clear that the time to open another bottle of red had come and so we moved onto a new topic, but perhaps there's a point here. Will the world change following the banking collapses of 2008, or will it just shuffle
a bit and then go back to how it was before?