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Cake day: June 15th, 2023

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  • A huge chunk of it is because the USA has a huge tax incentive for car manufacturers to make bigger cars. When fuel efficiency standards started coming in, trucks were exempted because farmers needed their trucks for farm work, it’s a loophole that encourages the manufacturers to build bigger vehicles to avoid these taxes. These massive vehicles are unusually cheap in the USA. If these loopholes regarding fuel efficiency were closed out people would be financially incentivised to buy smaller cars. Unfortunately, money talks. People aren’t all selfish, they’re just doing what makes sense for them.





  • The value is implicit to the company, the shares don’t create any new wealth. They convert equity in the company into cash. It’s a way for the organisation to trade that equity for free cash. This is why companies with very high profits and thus cash flows buy back their shares.

    When you buy shares you help move the market, driving the price of the shares up if there’s demand. Obviously this makes it harder for the company to buy shares back which might be a bad thing if the company is truly a great, sustainable business, but it also means that whatever percentage of the company they do still control can be sold for more cash when it’s needed.

    There is a good reason to invest in sustainable companies. From a personally selfish perspective they typically perform very well, and from a more holistic perspective, as mentioned above trading shares raises their price and increases the value of the org.

    From an organisations point of view, even entirely profit motivated companies that don’t have a shred of humanity in their management are incentivised to behave sustainability and ethically in the current environment. The only companies that can really get away with being unsustainable are business to business companies and those whose products are incredibly inelastic, i.e. big oil. For everyone else, the loss of goodwill for behaving unethically and unsustainably can be too big. If you cut off a big enough chunk of your market your profits are going to be impacted. Plus all the other elements of sustainability, like treating your employees half well leads to improved employee and talent retention, more productivity, better community engagement, free advertising from all the goodwill etc.

    Edit: there are also other risk factors for unsustainable management. Many more organisation are looking at their environment and their exposure to disasters. Fires are becoming a much bigger risk factor, and dangerous weather also poses a threat. For this reason some orgs now consider it prudent to go for net zero emissions for purely selfish reasons, not because it benefits everyone but because a better environment literally lowers their risk. Poor working conditions can also impact bottom line, especially if lawsuits line up. Overall, plenty of financial incentive for companies to behave sustainably these days.