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All true, but I think it misses at least two points:
Yet in recent decades, Boeing — like so many American corporations — began shoveling money to investors and executives, while shortchanging its employees and cutting costs.
Schools teach, or at least they used to, that there are three sets of stakeholders in a company. The two mentioned here - the owners and the employees - and a third, the customers. Boeing shortchanged its customers by compromising safety, by hiding information, by marketing the MAX as something it was not.
The other missing point is that what Boeing and nearly all other companies have been doing is not maximizing shareholder value, but maximizing short term profits and share price at the expense of long term growth. The piece talks of being profit obsessed, but doesn't delve into how focusing on stock price often leads to lower profits in the long term.
Almost 80 percent of chief financial officers at 400 of America’s largest public companies say they would sacrifice a firm’s economic value to meet the quarter’s earnings expectations. ... (This dynamic backfired at Wells Fargo, where employees pressured to meet quarterly targets opened accounts without customers’ permission.)
Actually, there are more than those three stakeholders as the community and nation in which a company’s facilities are located are also stakeholders. Consider the company with a factory it leases and pays taxes on in a specific town. That factory is blowing toxic fumes into the town causing residents to have higher cancer and respiratory illness rates, even though many residents are neither customers, employees nor shareholders. The town, its government and by proxy the state and national government where this polluting company exists are also stakeholders. And one could argue the planet’s environment itself though without human agency is a stakeholder.
The FAA should never have certified the 737 Max with such a major design flaw. I'm very disappointed in how Boeing handled this entire situation. Boeing once was a proud engineering-driven company. However, their culture started to deteriorate after the McDonnell Douglas acquisition in 1997. Link
I read the New Yorker article after posting. It very effectively depicts the culture at Boeing and the FAA which led to the two tragic plane crashes. What a mess!
Comments
The other missing point is that what Boeing and nearly all other companies have been doing is not maximizing shareholder value, but maximizing short term profits and share price at the expense of long term growth. The piece talks of being profit obsessed, but doesn't delve into how focusing on stock price often leads to lower profits in the long term. https://www.theatlantic.com/business/archive/2016/12/short-term-thinking/511874/
https://hbr.org/2015/10/yes-short-termism-really-is-a-problem
One has ...
Stone, Christopher D., Should Trees Have Standing - Towards Legal Rights for Natural Objects, Southern California Law Review 45 (1972): 450-501.
https://iseethics.files.wordpress.com/2013/02/stone-christopher-d-should-trees-have-standing.pdf
4 page book review (Fla. St. Law Review article):
https://ir.law.fsu.edu/cgi/viewcontent.cgi?article=1753&context=lr
>> Boeing shortchanged its customers by compromising safety, by hiding information, by marketing the MAX as something it was not.
https://www.newyorker.com/magazine/2019/11/18/the-case-against-boeing
Some of these top execs just so sorry.
I'm very disappointed in how Boeing handled this entire situation.
Boeing once was a proud engineering-driven company.
However, their culture started to deteriorate after the McDonnell Douglas acquisition in 1997.
Link
It very effectively depicts the culture at Boeing and the FAA which led to the two tragic plane crashes.
What a mess!