I was recently invited to be part of a debate that was moderated by Sharanjit Leyl from BBC World News about the role of government policies vs corporate profits when it comes to growing the economy.
It was pretty cool to meet Sharanjit in person because I see her on TV all the time. Before the debate began, it started off immediately will a poll from the audience about whether they believe it’s government policies or corporate profits that drive growth.
As a young business, I was representing the “corporate profits” team, and what surprised me before the debate began, a whopping 75% voted for a policy-driven approach to be more important when it comes to growing the economy. “That’s strange”, I thought, “surely growth is all about profits, because corporation are the ones paying taxes and creating jobs”. The government doesn’t do that, they are simply an enabler for corporations to achieve that goal.
But with all the negativity surrounding how corporations and their greed can go very wrong if not regulated properly (Enron, The US subprime crisis etc), there’s a huge distrust from the public when it comes to corporations allowed to “just do anything they want to make money”.
So are “corporate profits” evil?
As the owner of a business, I see growth in very simple terms. I started 18 months ago, alone, sitting a cafe. Building the website, doing video editing work, and writing about company culture. Over time, more and more companies loved what I did because I created value for them, so to meet that demand, I started hiring employees. Effectively I’ve created jobs. And these employees pay taxes.
WOBB continues to grow everyday, and as we keep creating value for our clients, revenues increase, and using those revenues we can hire more people to continue to grow the company and create more jobs.
That for me, is what real growth is all about. Sure, there has to be law and regulations, so government policies facilitate this, but everyone needs to understand that true growth is achieved when you are creating value for your customer, who pays you, and that allows you and your customer to grow together.
In the startup world, a lot of “growth” is generated through investor funding, rather than actual profits, and it’s something that many investors seem a bit less bullish about now. I think about a lot when we decided that WOBB would be very revenue driven. So while people see corporations as cold, selfish organisations that only care about making money, that’s a very limited view of what value many businesses have brought to the world, how many jobs have been created, and how much taxes they’ve contributed to the country.