Is Chrysler stakeholder capitalism in action?


In a blog at HBR, John Landry writes on Chrysler as an example of Stakeholder Capitalism.

I am not sure as to whether I am in favour of stakeholder capitalism as such, especially where it appears to have been implemented by one over mighty party at the expense of others with valid claims.

The post is worth reading.

From a governance viewpoint I find it concerning as it appears that an existing and understood framework within which various parties had lent money on contracted terms and conditions, has been effectively unilaterally changed for political benefit.

If a party other than government had done this, would they have gotten away with it?
Further the post commences with a statement which I take issue with, viz:-

Stakeholder capitalism–a market system in which companies treat the interests of all major stakeholders roughly equally, rather than explicitly favoring investors–is attracting growing interest in these recessionary times.  After all, most investors risk far less than what workers risk when the latter accept a job, so why should investors get the lion’s share of the reward?

One, I question whether this is a market system.

Secondly, why should all stakeholders be treated equally. In the Chrysler case I would argues that some stakeholders were treated disproportionately well.

Thirdly, why are investors seen as taking a lesser risk than employees.

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One response to “Is Chrysler stakeholder capitalism in action?

  1. Pingback: Is Chrysler deal an error by Obama? « Some Thoughts – Peter Salmon’s Blog

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