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Abolish Companies and Trusts

Abolish Companies and Trusts

Companies have a different ethical structure to the rest of our society: they have only one value (Money) and one ethic (make as much money as possible.) This attitude is spreading like a plague infecting everybody. A home is now an asset - but if you only have one its not much of an asset because you always need somewhere to live. Companies have no moral compass except make money: if its profitable to sell something that is useless or even harmful then those concerns are irrelevant. Also Tax is not viewed as a contribution to society but as a cost to be minimised. The purpose of companies (to enable joint investment ) can be equally filled by partnerships which keep liability for tax on natural citizens. If we dont abolish these corporate structures completely we could just remove their tax liability so that the shareholders would have to shoulder the burden - but this would be difficult and fraught with opportunities for abuse.

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    • Philip Wilkinson
      tagged this with dislike 2016-12-07 13:01:45 +1300
    • Robert Murray
      commented 2016-12-05 16:56:11 +1300
      Matt, I think this is impractical for most smaller businesses. I know of a very profitable business that the owner would be happy to devolve to employee buyout (6 employees) but none of them are interested in taking on the commitment: they like the ability to do their 40 hrs and walk away.
      I don’t know if business owners would be willing to put in the effort to have a business that they didn’t have at least 51% control over and Wellington Airport and Contact Energy are great examples of the powerlessness of less than 50% control.
      Maybe ownership share could be included as part of all employment packages (like it is for senior positions) – I believe Contact does this but am not aware of the extent.
      Some companies (AirNZ?) have adopted triple bottom line accounting – it provides some stunning examples of green washing – and I’m not aware of any improvement in employee conditions therefrom. It tends to be used to justify various corporate sponsorships which were happening as part of their corporate image.
    • duncan cairncross
      commented 2016-12-05 13:49:22 +1300
      I want to upvote Matt Walkington’s suggestion
    • Matt Walkington
      commented 2016-12-05 13:41:11 +1300
      Rather than abolish companies, it would be possible to legislate to adjust the rules and laws that influence their structure and behaviour. Some easy to do examples are: we could require a minimum employee representation (say 50%) on boards.; we could require partial staff ownership or require that businesses have plans to transition to partial or full staff ownership; we could require that businesses use triple bottom line accounting . These measures would be possible immediately there was political will without terminal or major disruption to economic stability, particularly if they were phased in progressively.
    • Matt Walkington
      tagged this with interesting 2016-12-05 13:41:10 +1300
    • Robert Murray
      commented 2016-12-04 21:10:16 +1300
      Bruce, Given said banking covenants are held by banking companies which would also have been abolished, the first step in your logical chain of disaster is flawed. However I agree that reducing their ability to play with taxes is the primary goal so my Tax suggestion would be sufficient. However, without their ability to manipulate tax I suspect there would be little demand for companies and they would become redundant. I note a large part of our Primary Industry (not just Fonterra) id Cooperative rather than Corporate. My concern about their influence on society still stnds.
    • Bruce Thomas
      commented 2016-12-04 10:58:03 +1300
      Abolishing companies would render the NZX near worthless immediately. This would put all listed companies in NZ in receivership as they would breach their banking covenants. There would be mass unemployment, mass social disruption. The tax take would plummet and as a country we would be unable to provide welfare. those that were lucky enough to get their money out of the share market would look for an alternative investment – possibly property, which would be affordable as thousands of kiwis were forced to sell their homes. We would be the Greece of the South Pacific.
    • Bruce Thomas
      tagged this with dislike 2016-12-04 10:58:02 +1300
    • Dennis Ingram
      commented 2016-12-03 17:03:01 +1300
      I agree with the sentiment that corporations are motivated to make money and not necessarily care about employees, customers or the environment. But they aren’t all bad – just like people, corporations can work for good or evil. I think removing them would place a significant block on progress. Having said that, alternative structures such as cooperatives may be appropriate in some cases, i.e. organisations where employees have more skin in the game and perhaps more moral incentive to behave.
    • Dennis Ingram
      tagged this with interesting 2016-12-03 17:03:01 +1300
    • Graeme Kiyoto-Ward
      commented 2016-12-02 07:17:18 +1300
      Not a flyer. Not if it means eliminating companies. Some industries are doing big they need a company ownership structure to exist because no single person could have the capital, e.g. airlines.
    • Robert Murray
      commented 2016-12-01 23:28:17 +1300
      Duncan the problem is that the only definition of “good citizen” is one that obeys the law and the law has no ethical content. The same problem arises with the psychopaths in our society – until they break the law they are invulnerable. I might suggest that there has been influence on legislators to amend the law to minimise corporate exposure. For example I believe the TPPA removes company v state disputes from the nation’s courts to an arbitration tribunal. Dont get me started on the failings of arbitration.
    • duncan cairncross
      commented 2016-12-01 23:09:28 +1300
      Companies should have a requirement to be good “citizens” – and be abolished if the individual company does not meet its requirements
      Which I believe is what it was like when the idea of the limited liability company was developed
    • duncan cairncross
      tagged this with important 2016-12-01 23:09:27 +1300
    • Tim O’Donnell
      commented 2016-12-01 10:30:29 +1300
      I agree with some of your points but not abolishing.
    • Tim O’Donnell
      tagged this with interesting 2016-12-01 10:30:29 +1300
    • Robert Murray
      published this page in Suggestions 2016-12-01 09:47:29 +1300