The Role of the Company in the Time of Covid-19

The Covid-19 virus and the resulting pandemic have caused tragic loss of life and suffering. As countries have tried to lower the infection rate they have been forced to shut down large swathes of their economies. The necessary but self-imposed hardship has impacted everyone in society, albeit not equally. Much of the commentary on Covid19 has focused on how the pandemic has accelerated existing underlying trends. This article will argue that a similar process is taking place in relation to attitudes towards the company and its role in society, focusing on the UK. These changes are not necessarily part of a single, consistent set of policy decisions. Instead, they reflect broader, preexisting changes in society and our assumptions about the interaction between profit and purpose. The actions taken by the Government are based (whether consciously or not) on the principle that companies are not purely private assets but instead agents for positive change. Informed by this growing view, the Government has (in some respects) enlisted private assets to deliver its broader societal outcomes. One can place these actions within the pre-existing trend towards a more enlightened shareholder value approach to the company, with a belief that companies should also operate for the benefit of broader stakeholders rather than just shareholders. However, the recent changes have still not fully ushered in enlightened shareholder value. Instead the Government has continued its prior tendency of relying on a system of disclosure-based regulation in the context of corporate governance, which does not always adequately deliver positive social outcomes.