Enough for all need, not greed

Well done, Chris Moerdyk, on your frank exposé of corporate greed.

The blame for the current financial meltdown has been laid firmly on excessive executive greed (especially in the US banking sector), the poor regulation of financial instruments and the lure of  easy credit.

The result is that the global household is much poorer with the loss of hard-earned retirement savings—far bigger than Enron of course; there the chief and financial executives were prosecuted. Surely this should now be so in the US? Surely they must relinquish a good portion of their assets at the very least?

Local executives have shown the same greed. While markets went high, many executives here agreed to increases well above inflation, supposedly tracking share price performance. The shop floor did not enjoy the same party. Many executives in listed companies, including our banks and reserve bank, were guilty.

As business writer Lucy Kellaway said, transparency in executive pay led to a scramble to out-earn each other rather than narrowing of the gap between executive and floor-sweeper pay — unforgivable in South Africa, given our levels of poverty. Executive pay must now fall in line with current share prices.

The capitalist model has been badly tainted by this crisis. A more equitable model is now required. The relentless chase after company growth is a fallacy: it is not sustainable. A quote from 1947 by the US evangelist Frank Buchman comes to mind: “There is enough in the world for everyone’s need, but not enough for everyone’s greed.”

Steve Lincoln, Port Elizabeth