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Virginia Postrel

Stakeholder Capitalism Isn’t Working as Planned

It’s a prescription for culture wars, political backlash, managerial paralysis and human-resources nightmares. And it’s anything but nice. 

Just one of nearly 200,000 Disney employees.

Just one of nearly 200,000 Disney employees.

Photographer: Octavio Jones/Getty Images

Wouldn’t it be nice if companies cared less about profits and more about the social good? It’s popular to think so. Stakeholder capitalism is fashionable. Shareholder capitalism is not.

Many high-profile business leaders and academics now condemn the idea Milton Friedman laid out in a famous 1970 New York Times Magazine essay: