thyme4change
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Post by thyme4change on Aug 21, 2019 11:04:32 GMT -5
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billisonboard
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Post by billisonboard on Aug 21, 2019 11:06:58 GMT -5
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Cheesy FL-Vol
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Post by Cheesy FL-Vol on Aug 21, 2019 11:19:12 GMT -5
I saw that a few days ago, and I don't buy it.
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thyme4change
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Post by thyme4change on Aug 21, 2019 11:21:49 GMT -5
I saw that a few days ago, and I don't buy it. Hedging bets in case Bernie gets elected. They can claim they have already adjusted and government need not get involved?
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Miss Tequila
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Post by Miss Tequila on Aug 21, 2019 11:41:27 GMT -5
Seems like a lot of lip service. I just left a global organization that was based in one of the most liberal European countries and guess what...the only thing that mattered was the bottom line. Headcount was a number, they didn't care how much they put on employees, the local community was never mentioned (our customers were global so there was no push to put our name out locally), all that mattered that we hit a ridiculously aggressive EBITDA # and cash targets.
I now work for a local company and the workload is manageable but in the end, if our bottom line is not there then we cut expenses and that includes headcount.
I would hate to be an investor in a company that didn't focus on the bottom line.
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souldoubt
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Post by souldoubt on Aug 21, 2019 12:02:06 GMT -5
Seems like a lot of lip service. I just left a global organization that was based in one of the most liberal European countries and guess what...the only thing that mattered was the bottom line. Headcount was a number, they didn't care how much they put on employees, the local community was never mentioned (our customers were global so there was no push to put our name out locally), all that mattered that we hit a ridiculously aggressive EBITDA # and cash targets. I now work for a local company and the workload is manageable but in the end, if our bottom line is not there then we cut expenses and that includes headcount. I would hate to be an investor in a company that didn't focus on the bottom line. Wouldn't that be all of us when it comes to the government? In my adult career I've worked for a non profit company and a private company in completely different industries. Both companies have had to make cuts and workloads increased while the non profit company was eventually absorbed and pretty much all the remaining employees were let go some time after I left. As someone involved on the finance side I can say that in both cases the lack of emphasis on the bottom line hurt them just the same.
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hoops902
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Post by hoops902 on Aug 21, 2019 12:32:10 GMT -5
Let's be clear, they say this, and I do think they believe it, but it's not exactly that they've replaced "shareholders" with "employees" as the primary driver. Here's the quote which is at the center of this:
“Major employers are investing in their workers and communities because they know it is the only way to be successful over the long term. These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.”
They're doing/saying this because it's true. They're doing these things because they think it is the "only way to be successful over the long term". They aren't doing it to help employees because they want to help employees...they're doing it because not doing so is more likely to result in a bad bottom line or complete closing of the business long-term.
So if they believe this is the way they maximize their chance to be successful long term, and they choose NOT to do it...that hurts the shareholders. Shareholders don't do well when a company signals they are in trouble long-term. If the new "indicator" was wind energy, all the companies would be talking about how much they think renewable resources are SO important...but it's only important because they believe it's driving shareholder wealth at the bottom line. You don't ever REALLY have to say "the shareholders are the most important thing" because everyone already knows that. You have to SAY the right things, so that the market reacts favorably to what you're saying, and then the shareholders benefit.
Notice that nobody is saying "the employees are most important, and we're willing to sacrifice the long-term health of the company to give them what we think they deserve". It's all based on "we're saying this, because that's what we think is driving long term company health, which in turn drives shareholder profit". I'm less cynical that it's just lip service, I think they do care and want to actually do it...but the motives aren't benevolent, they are profit-driven and they don't seem to be hiding that they are profit driven.
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hoops902
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Post by hoops902 on Aug 21, 2019 12:36:14 GMT -5
I'll illustrate with another example:
If what REALLY matters to me is "I want my child to get into Harvard". I'm not going to tell an interviewer from Harvard that it's what really matters to me if I'm smart. I'm going to decide what I think gets kids into Harvard...in this case let's say "being a well rounded human being" and I'm going to tell the person "The most important thing to me is that my child is a well-rounded human being". And in some ways...it might be...I think that making my child a well rounded human being is the best way to get them into Harvard. So I believe that them being a well-rounded human being is the most important, I'll work to make them a well rounded human being...but it's not because I necessarily believe that it's important in-and-of itself...I believe it because I believe that's the path to the end goal that I REALLY care about...Harvard.
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thyme4change
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Post by thyme4change on Aug 21, 2019 17:46:57 GMT -5
If we can get out of the quarterly earnings cycle, and do more long term thinking, I think we might be better off.
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formerroomate99
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Post by formerroomate99 on Aug 22, 2019 12:29:40 GMT -5
If we can get out of the quarterly earnings cycle, and do more long term thinking, I think we might be better off. That’s what I was thinking. Often, what makes sense in the short term is harmful in the long term. And in a hot job market, not taking care of your employees means a lot of turnover, which is expensive, and results in a lot of lost domain knowledge. Hard to say whether this is anything more than lip service. I’ve worked for a couple of these young companies, where they have pretty buildings, ping pong tables and free snacks and talk endlessly about their awesome culture. Both of them had piss poor management and a toxic work culture. I’ve had much better luck at companies that just do their thing without talking about how awesome they are.
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phil5185
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Post by phil5185 on Aug 22, 2019 13:56:50 GMT -5
Major employers are investing in their workers and communities "because they know it is the only way to be successful over the long term". These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.
I worked for SP500 companies for 35 years, and traveled to dozens more for business meetings. In my experience, that bold phrase is absolutely true. And at inter-corporate strategy meetings, those that did not grasp that concept were left behind. In fact, I'm surprised to hear that the worker/community concept is considered to be "new".
It became obvious in the 1960s that the old "crack the whip, push for more work" was counterproductive - ie, it didn't provide more profits for stock holders nor was it good for employees/communities. That is why I'm surprised to hear so many anti-corporate comments these days.
Only about 6.4% of the private sector is unionized. That indicates that workers no longer feel the need for unions, the basic work rules are being followed w/o union representation. (Except for the public sector, they seem to need unions).
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thyme4change
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Post by thyme4change on Aug 22, 2019 14:10:54 GMT -5
Major employers are investing in their workers and communities "because they know it is the only way to be successful over the long term". These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.
I worked for SP500 companies for 35 years, and traveled to dozens more for business meetings. In my experience, that bold phrase is absolutely true. And at inter-corporate strategy meetings, those that did not grasp that concept were left behind. In fact, I'm surprised to hear that the worker/community concept is considered to be "new".
It became obvious in the 1960s that the old "crack the whip, push for more work" was counterproductive - ie, it didn't provide more profits for stock holders nor was it good for employees/communities. That is why I'm surprised to hear so many anti-corporate comments these days.
Only about 6.4% of the private sector is unionized. That indicates that workers no longer feel the need for unions, the basic work rules are being followed w/o union representation. (Except for the public sector, they seem to need unions).
I was with you until the last paragraph. I will say that unions screwed themselves by being corrupt and power hungry, but I bet plenty of workers would love collective bargaining. Companies know exactly how far they can push employees to not unionize, and they do it. Happens all the time.
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hoops902
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Post by hoops902 on Aug 26, 2019 10:36:41 GMT -5
If we can get out of the quarterly earnings cycle, and do more long term thinking, I think we might be better off. Yes, and i think nearly everyone would agree with that. The question has always been how do we balance running a business for the long-term which carries MUCH more uncertainty, investors who are generally not long-term investors, and not keeping people in power long enough to run the company into the ground? Some companies try to focus on the long-term...but if the short term is not good, then stock prices drop, people don't want to be invested in that company, and leadership gets fired. Long-term focus is much easier on companies that don't have "shareholders" in terms of the public. It's not conducive to tell the general public "we're going to look like shit for a few years, but just trust us, we know what we're doing" to a bunch of people with a lot of options who don't actually know the person asking for trust. The companies that can do that are the ones heavily owned by a few key players who own most of the company and control the stock, or private companies, or something similar where they don't have to worry about their jobs when the price tanks. EVERY leadership group is going to say "trust us" when the stock tanks...whether they are capable of turning it around, whether it's part of their long-term strategy, or whatever. Unless you have a very specific reason to believe a specific person when they say it...it's all just the same noise because it's the same message regardless of whether the company is planning for the future or permanently sinking.
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tskeeter
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Post by tskeeter on Aug 28, 2019 22:59:40 GMT -5
Major employers are investing in their workers and communities "because they know it is the only way to be successful over the long term". These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.
I worked for SP500 companies for 35 years, and traveled to dozens more for business meetings. In my experience, that bold phrase is absolutely true. And at inter-corporate strategy meetings, those that did not grasp that concept were left behind. In fact, I'm surprised to hear that the worker/community concept is considered to be "new".
It became obvious in the 1960s that the old "crack the whip, push for more work" was counterproductive - ie, it didn't provide more profits for stock holders nor was it good for employees/communities. That is why I'm surprised to hear so many anti-corporate comments these days.
Only about 6.4% of the private sector is unionized. That indicates that workers no longer feel the need for unions, the basic work rules are being followed w/o union representation. (Except for the public sector, they seem to need unions).
I was with you until the last paragraph. I will say that unions screwed themselves by being corrupt and power hungry, but I bet plenty of workers would love collective bargaining. Companies know exactly how far they can push employees to not unionize, and they do it. Happens all the time. I think that we’re seeing the cause for labor unions impacting the white collar ranks over the last 20 years. Massive staff reductions. No real new tools to make the work more efficient. More demanding work and work schedules. A “you’re lucky to still have a job, just get it done” attitude from senior management and the Board of Directors. As the only person in what was once a five person department, my projection is that union membership will start to increase. And that the new union members will be white collar workers from the private sector.
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thyme4change
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Post by thyme4change on Aug 29, 2019 15:06:03 GMT -5
I was with you until the last paragraph. I will say that unions screwed themselves by being corrupt and power hungry, but I bet plenty of workers would love collective bargaining. Companies know exactly how far they can push employees to not unionize, and they do it. Happens all the time. I think that we’re seeing the cause for labor unions impacting the white collar ranks over the last 20 years. Massive staff reductions. No real new tools to make the work more efficient. More demanding work and work schedules. A “you’re lucky to still have a job, just get it done” attitude from senior management and the Board of Directors. As the only person in what was once a five person department, my projection is that union membership will start to increase. And that the new union members will be white collar workers from the private sector. It might be great for America. And it gives businesses an "out". They have gotten to the place where employees can be treated so badly, but if one company tried to stop it, the shareholders would retaliate. If unions come in across companies and industries, reform will be thrust upon companies and shareholders will have to deal with it. Maybe employees can capture some of that sweet, sweet wealth that the USA has.
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Pants
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Post by Pants on Aug 29, 2019 15:10:42 GMT -5
As someone who's got insight into this process: No.
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tskeeter
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Post by tskeeter on Aug 29, 2019 20:35:03 GMT -5
As someone who's got insight into this process: No. Pants, I have no doubt that you are right. About six months ago I read an article on the psychological profile of the “most successful” Fortune 500 CEO’s. A good share of them would be diagnosed as psychopaths. The focus of a psychopath is on what is good for them. And what they believe they are “entitled” to. Screw everyone else. So, if I have to lay off 500 people the week before Christmas to ensure that I maximize my bonus; so be it. Sucks to be you, former employee. But, I’m great. Third year in a row of maximum bonus. Guess that means that all the hype about “employee engagement” is really just a ploy to get employees to do a lot more work for very little more money. And hope to convince the employees to feel good about the “great” place that they work. Kind of like the shift to performance based compensation (bonuses) at one place I worked. It was sold as a way to reward above average performers. But, I was given information that I probably shouldn’t have had. It showed that the new performance based compensation system was projected to reduce compensation cost. A few anointed stars might get a bit more, but most of the employees would see increases in the cost of living slowly eat away at the buying power of their pay checks.
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Pants
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Post by Pants on Aug 29, 2019 20:43:16 GMT -5
A couple good articles on Slate and the Economist on this, btw.
Almost all companies in the US are incorporated in Delaware. This subjects them to a law that says they are legally required to put shareholders first.
Unless companies take the step to either incorporate in a different state, or change delaware law, this is much ado about nothing.
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hoops902
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Post by hoops902 on Aug 30, 2019 8:53:08 GMT -5
A couple good articles on Slate and the Economist on this, btw. Almost all companies in the US are incorporated in Delaware. This subjects them to a law that says they are legally required to put shareholders first. Unless companies take the step to either incorporate in a different state, or change delaware law, this is much ado about nothing. Neither of these things are necessary to accomplish what the article is supporting as a point of view. The article isn't really supporting putting employees OVER shareholders, it's taking the stance (or is reporting that CEOs are taking the stance) that "taking care of employees" is more vitally important to long term financial success which is what drives shareholder profits. I think the primary issue is that the title of this thread is misleading/misguided in terms of what the article is supporting as a point of view. The CEOs aren't actually saying that shareholders aren't #1 anymore at all. The article is actually talking about "how can we provide the best long term value for shareholders?" and the avenue that CEOs think is increasing as the way to drive long term value is in taking care of lots of people (employees, people in the communities they are active in, etc). I do think that we're headed down a path where APPEARING to be socially responsible with your employees and communities you are in is important...how closely the appearance of that aligns with actually doing it varies. ALL of that is simply theory on HOW to drive shareholder wealth though.
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Pants
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Post by Pants on Aug 30, 2019 8:56:57 GMT -5
A couple good articles on Slate and the Economist on this, btw. Almost all companies in the US are incorporated in Delaware. This subjects them to a law that says they are legally required to put shareholders first. Unless companies take the step to either incorporate in a different state, or change delaware law, this is much ado about nothing. Neither of these things are necessary to accomplish what the article is supporting as a point of view. The article isn't really supporting putting employees OVER shareholders, it's taking the stance (or is reporting that CEOs are taking the stance) that "taking care of employees" is more vitally important to long term financial success which is what drives shareholder profits. I think the primary issue is that the title of this thread is misleading/misguided in terms of what the article is supporting as a point of view. The CEOs aren't actually saying that shareholders aren't #1 anymore at all. The article is actually talking about "how can we provide the best long term value for shareholders?" and the avenue that CEOs think is increasing as the way to drive long term value is in taking care of lots of people (employees, people in the communities they are active in, etc). I do think that we're headed down a path where APPEARING to be socially responsible with your employees and communities you are in is important...how closely the appearance of that aligns with actually doing it varies. ALL of that is simply theory on HOW to drive shareholder wealth though. Dude. This is my whole job. I know what it says and i’ve been doing nothin but talking about it for 11 days.
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hoops902
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Post by hoops902 on Aug 30, 2019 9:06:35 GMT -5
Neither of these things are necessary to accomplish what the article is supporting as a point of view. The article isn't really supporting putting employees OVER shareholders, it's taking the stance (or is reporting that CEOs are taking the stance) that "taking care of employees" is more vitally important to long term financial success which is what drives shareholder profits. I think the primary issue is that the title of this thread is misleading/misguided in terms of what the article is supporting as a point of view. The CEOs aren't actually saying that shareholders aren't #1 anymore at all. The article is actually talking about "how can we provide the best long term value for shareholders?" and the avenue that CEOs think is increasing as the way to drive long term value is in taking care of lots of people (employees, people in the communities they are active in, etc). I do think that we're headed down a path where APPEARING to be socially responsible with your employees and communities you are in is important...how closely the appearance of that aligns with actually doing it varies. ALL of that is simply theory on HOW to drive shareholder wealth though. Dude. This is my whole job. I know what it says and i’ve been doing nothin but talking about it for 11 days. Your whole job is what? I quoted you talking about something meaningless around companies being incorporated in Delaware which isn't relevant to the topic at all given that nobody is saying anything about not having shareholders as #1 anymore. This is your whole job and your takeaway was that in order for companies to drive shareholder wealth via an appearance of social consciousness that they would have to violate Delaware law? I do find it interesting that your conclusion is that this is nothing, but you've spent 11 days talking about something you find to be nothing.
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