Value = Profit + Public Good

When people talk about how well a company is doing or try to value a company, it is common practice to refer to its stock price or its most recent quarterly earning statements. I would contend that profit is a narrow way to value a company. Profit tells us very little about intangibles like what the a company's impact on the environment is or whether a company is treating its workforce fairly. I would argue that a much better way to value an organization, whether it be for-profit or not-for-profit, would be to look at both the income it is generating and the public good that it is creating. Jed Emerson, a senior Fellow at the Generation Foundation, has made a very similar argument in his essays about blended value. To learn more about his theory of blended values visit: www.blendedvalue.org

In a utopian world, public good be quantified and measured, so that the true value of both for-profit and not-for-profit organizations could be known. Conceivably, in this world, companies that produce negative public good, could fund the work of social sector organizations that generate little economic profit, but create a lot of public good, through a system that is much like the one we see for carbon trading today.

Accountability for Foundations

This broadcast on the State of Things on WUNC with Joel Fleischman, a professor at Duke, was music to MOTG's ears.

Joel covers a wide range of topics that are covered in his new book, The Foundation, including accountability for foundations, the need for information disclosure in the sector, the investing practices of foundations, and the trend of convergence between the business sector and the social sector.