Chapter 1 Requirements Below Is An Essay From Roberto C

A 16 Chapter 1 requirementsbelow Is An Essay From Roberto C Goizueta

Below is an essay from Roberto C. Goizueta, Chairman of the Board of Directors and Chief Executive Officer of Coca-Cola, in February 1997. Please write a 2-page summary of the essay, double spaced. Why Share-Owner Value? At The Coca-Cola Company, our publicly stated mission is to create value over time for the owners of our business. In fact, in our society, that is the mission of any business: to create value for its owners. Why? The answer can be summed up in three reasons. First, increasing share-owner value over time is the job our economic system demands of us. We live in a democratic capitalist society, and here, people create specific institutions to help meet specific needs. Governments are created to help meet civic needs. Philanthropies are created to help meet social needs. And companies are created to help meet economic needs. Business distributes the lifeblood that flows through our economic system not only in the form of goods and services, but also in the form of taxes, salaries and philanthropy. Creating value is a core principle on which our economic system is based; it is the job we owe to those who have entrusted us with their assets.

We work for our share owners. That is – literally – what they have put us in business to do. That may sound simplistic - but we often see companies that have forgotten the reason they exist. They may try to serve many masters in many ways but miss their primary purpose: creating value for their owners. A healthy company can positively impact society, providing jobs, serving customers, and contributing to philanthropy. Conversely, a sick company is a burden on society, unable to sustain jobs or make meaningful contributions. The second reason we create value over time is the societal benefit. Our investments, such as those in Eastern Europe following the fall of the Berlin Wall, exemplify how doing good work—meeting societal needs—also builds long-term value for our share owners. This ripple effect benefits society by enriching institutions like university endowments and foundations, reinforcing a cycle of growth and giving.

Third, focusing on long-term value creation prevents shortsighted decisions. Share owners seek dependable investments, not quick gains that undermine future stability. Balancing the interests of shareholders and stakeholders over the long run sustains societal health, which in turn sustains profitable growth. Corporate responsibility, therefore, aligns with the long-term interests of all. Neglecting societal well-being can hamper business success; acting solely for short-term gains sacrifices the long-term. Coca-Cola’s 110-year history exemplifies disciplined long-term focus—posing the question: what can we do today to ensure we still thrive in a billion Coca-Colas? The essence of our mission, then, is not just to sell more product but to create sustainable value for owners, employees, partners, and society at large. Ultimately, serving society is best achieved by creating value over time for those who hired us.

Paper For Above instruction

The essay by Roberto C. Goizueta emphasizes the fundamental role of creating long-term shareholder value as the core mission of a business. He argues that businesses operate within a societal framework where their primary purpose is to generate economic value responsibly over time, benefiting not only owners but the broader community. This perspective aligns with the principles of a democratic capitalist system, which encourages institutions, including corporations, to serve specific societal needs through meaningful contributions.

Goizueta underscores that companies have a duty to their share owners, who entrust them with assets to generate returns. He warns against the tendency of some companies to deviate from this purpose, attempting to serve many interests or pursue short-term gains at the expense of sustainability. A focus on long-term value creation, he asserts, ensures ongoing societal benefits, such as employment, economic development, and philanthropy. His investments in Eastern Europe exemplify how corporate initiatives that address social needs can simultaneously build shareholder value, illustrating a symbiotic relationship between societal progress and business success.

Importantly, Goizueta highlights that sustainable growth and corporate responsibility are intertwined. By prioritizing long-term interests, companies foster societal stability, which in turn sustains profitable operations. He criticizes the shortsighted pursuit of immediate profits and advocates for a disciplined approach grounded in enduring value—comparable to the timeless nature of Coca-Cola’s brand and business. His rhetorical question about what must be done to make a billion Coca-Colas ago this morning underscores the importance of strategic foresight and persistent focus on future success.

In conclusion, Goizueta contends that the ultimate responsibility of a corporation extends beyond maximizing short-term revenues to fostering societal well-being through responsible, sustained value creation. His vision advocates for a balanced approach where corporate responsibility and shareholder interests are mutually reinforcing, ensuring the prosperity of both society and business over the long haul. This philosophy remains relevant today, emphasizing that ethical, long-term strategies are essential for enduring success in a complex global economy.

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