Business The Business Roundtable, America’s foremost association of chief executives, caused a stir when it redefined the purpose of a company, ditch
Business The Business Roundtable, America’s foremost association of chief executives, caused a stir when it redefined the purpose of a company, ditching the decades-old orthodoxy that increasing shareholder value should be the only objective. Now, the bosses say, companies should also look out for the interests of customers, workers, suppliers and communities, and aim to increase diversity and protect the environment. The statement was signed by almost 200 CEOS, encompassing relative upstarts, such as Amazon and Apple, as well as companies that trace their roots back well over 100 years, including ExxonMobil, General Motors, JPMorgan Chase and Macy’s. See article.Get our daily newsletterUpgrade your inbox and get our Daily Dispatch and Editor’s Picks.The minutes from the Federal Reserve’s latest meeting revealed splits over whether to lower its main interest rate. The central bank opted for a cut of a quarter of a percentage point, but two of the ratesetters wanted a half-point cut. Others wanted to hold rates steady.Germany’s central bank warned that there was a real risk the country could slip into recession, describing the economy as “lacklustre”. The Bundesbank pointed to data showing that industrial production is still slowing. See article.Thailand’s government announced a $10bn stimulus package to spur growth in the economy, which has been hit by a surging currency, leading to a slump in exports. GDP rose by 2.3% in the second quarter compared with the same three months last year, the slowest rate since mid-2014. The stimulus measures include incentives for Thais to holiday in their country, as well as extra support for farmers, small businesses and the poor.In a move that it described as a “market-based reform”, China’s central bank set a new benchmark interest rate, the Loan Prime Rate, which will more closely resemble what commercial banks pay it to borrow. See article.American regulators approved an easing of the restrictions on trading by banks that had been introduced under the Volcker rule during the financial crisis. The changes, first mooted in May 2018, simplify the legal definitions of what constitutes proprietary trading, where banks use their own money to invest. Critics contend that weakening the rule will allow banks once again to engage in risky bets through opaque financial instruments.Drop the pilotCathay Pacific’s share price had another turbulent week following the surprise resignation of Rupert Hogg, its British- born chief executive. Based in Hong Kong, the airline has become enmeshed in the city’s recent political strife. China’s state-run press has called for a boycott of Cathay because of its staff’s participation in ongoing street protests. Separately, Alibaba has reportedly postponed a blockbuster listing of shares on the Hong Kong exchange in part because of the political uncertainty. See article.America’s Commerce Department extended the exemption period under which some American companies can conduct business with Huawei, to November 19th. This is primarily to allow rural telecom providers more time “to wean themselves off” the Chinese maker of telecoms equipment, which has been slapped with a ban over national-security concerns.SoftBank was reported to be planning to lend staff up to $20bn so that they can buy stakes in Vision Fund 2. That would come on top of the $38bn that the Japanese conglomerate is itself ploughing into the venture-capital project, raising questions about SoftBank’s exposure to potentially risky tech startups.A long stretch of cost-cutting and the sale of its shale-gas business boosted the fortunes of BHP. The mining company reported underlying income of $9.1bn for the 12 months ending June, its best annual profit in five years, and returned a record dividend to shareholders. Although demand for BHP’s iron ore, copper and coal is still strong in China, it flagged trade tensions as a potential threat to business.As it works towards restoring investor confidence following its troubled acquisition of Monsanto, Bayer agreed to sellits animal-health business for $7.6bn. The German drugs and chemicals group recently sold its Coppertone sun-cream unit and Dr Scholl’s foot-care division, bringing in more cash. Bayer faces a host of legal claims that its Roundup weedkiller, which it inherited when it took over Monsanto, causes cancer.They’re over here for the beerThe weakness of the pound, which lowers the cost of buying British assets to overseas investors, was reportedly one of the factors behind an offer from CK Asset Holdings, a property investment firm based in Hong Kong, for Greene King, a pub chain. The deal is worth £4.6bn ($5.6bn). Founded in 1799, Greene King operates around 2,700 pubs, which CK Asset believes will continue to form a central part of British culture long after Brexit. Cheers to that.