Firms of EndearmentPosted: October 17, 2011 | |
I had the great opportunity to speak to the Golden Isles Investment Group today at The Lodge on St. Simons Island. This is a group of ladies who take investing very seriously. They come from a variety of backgrounds, but work together to make decisions that are best for the group.
Before the talk, I gave the group an assignment to read the book, Firms of Endearment by Raj Sisodia, Jag Sheth and David Wolfe. My goal was to have a discussion about responsible investing, not to just preach about it.
The premise of the book is that corporations are not only accountable to shareholders, but to all stakeholders. “Stakeholders are part of a complex network of interests that function in a matrix of interdependencies. Each stakeholder tends to thrive best when all stakeholders thrive. No stakeholder group is more important than any other. To see matters otherwise is like saying that the heart is more important than the lungs. Life depends on both being healthy.”
So, they believe that there are five stakeholders that, when given equal treatment, make a company (and an investment) better. The five stakeholders are (using the acronym SPICE):