30 Ottobre 2025
Autori: Jordana Rech Graciano dos Santos, Fabrizio Sammarco, Elisabetta Scognamiglio, Ian McCarthy
Abstract:
Since 1970, when Milton Friedman wrote his famous article in The New York Times arguing that a business’s primary goal should be to maximize profits, many companies have embraced this view. This marked the rise of shareholder theory, which focuses on the idea that a company’s main aim should be to maximize returns for its shareholders. Over time, especially in recent years, economic theories and business practices have evolved to adapt to new realities after some important external events, such as financial crises and environmental crises, have demonstrated that a business cannot consider only the interests of shareholders but also the value (not just economic) that it can create or destroy through its operations.
Important concepts, such as blended or creating shared value (CSV), challenge Friedman’s view that profits should be measured solely economically. Both concepts relate to economic and societal progress relationships, generating economic and societal benefits instead of merely donating money to a certain cause or defining business’ responsibilities to address societal challenges. Today, many companies recognize that financial success is not the only important outcome—social and environmental impacts also matter. This broader approach emphasizes the importance of the well-being of employees, communities, and the environment, showing that businesses can create value beyond financial profit. Combining profit-driven motives with social impact goals is a crucial area of study and practice. Many companies are changing their institutional logic to address their challenges better. This teaching case gives an example of a hybrid company that effectively manages the challenges of this new logic.
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