Comment by anon_e-moose
3 months ago
A corporation is a bunch of people cooperating to achieve a common goal.
There is a very important factor that heavily influences (perhaps even controls?) how people act to achieve that goal, and sometimes even twists or adds goals.
Is that corporation publicly quoted in the stock market or is it private?
Look at how steam behaves, it's private and more ideological VS how many other publicly quoted companies, whose CEO often sacrifices his own corporation's long term survival for the benefit of short-term profiteering and some hedge fund manager's bonus.
Both need profit to survive, but the publicly quoted company is much more extreme.
When people say corporations only look to profit, what they really mean is that publicly quoted corporations will do everything possible to maximise short term profit at any cost. Is there a CEO caring for long term? Either he will be convinced to change or kicked out. It's almost impossible for someone to resist these influences in publicly quoted companies. It's just how Wall Street works and if that doesn't change neither will corporations.
The people running the world of finance and their culture are what causes enshittification and pushing a zero-sum game to extremes.
Agree with everything, but would add a small detail : publicly quoted corporations might as well sell dreams and if they are very good at doing that have no profit because of some future potential pay off (of course I am writing this from my fully self driving car that I own since 10 years ago, that might transform in a robot soon).
> corporations will do everything possible to maximise short term profit at any cost. Is there a CEO caring for long term? Either he will be convinced to change or kicked out.
While public companies are more likely to be short term focused, even this is not true. There are plenty (ie. thousands) of executives and public companies that are long term focused and tell investors to pound sand and sell the stock (or mount a shareholder challenge) if they don't like it.
Elon Musk is the most extreme example of this. He wants to go to Mars. He is turning Tesla into a robot company and discontinuing or curtailing the growth of some of his most profitable products.
Mark Zuckerberg is another one. He is losing $20 billion a year on VR, and even with recent cuts, will still be doing that. He's spending $50 billion on AI. None of that has anything to do with short term profit. Don't like it? Sell the stock.
Wall Street doesn't necessarily force companies into short term gains: they hold you to perform to what you say you will perform. This is often the trap that leads to poor management decisions, as they overpromise and underdeliver, leading to the enshittification spiral.
All of this depends on the governance structure and ownership structure, and how competitive the business is.
Many public companies for example have only common shares available while a family or an individual retains preferred shares with more voting power. This is how Zuck, or Larry Page or Larry Ellison etc can do whatever they do. Elon just has a reality distortion field so the board gives him a trillion dollar pay package.