Time for change: from shareholder value to stakeholder value

Ladies and gentlemen,

President Theodore Roosevelt once said: 'The things that will destroy America are prosperity at any price, peace at any price, safety first instead of duty first, the love of soft living, and the get-rich-quick theory of life.'

These are wise words. Because they are still relevant today. But above all, because they apply not only to the United States but to the whole world. For wasn't the present economic crisis caused by the pursuit of prosperity at any price? Hasn't a few people's love of soft living impacted the lives of millions? Are we not all in danger due to the get-rich-quick theory of life?

Our most critical task at present is of course to tackle the global crisis. To prevent our financial system from collapsing and to promote economic activity with smart and effective measures. But we also need to consider what lessons we can and must learn. How can we prevent this from ever happening again? We will be discussing this issue at the UN General Assembly and the G20 summit in Pittsburgh this week. It is also a recurring theme at this Global Creative Leadership Summit. To kick off today's discussion, I would like to share a few thoughts with you.

I believe this crisis will prove to be a catalyst for change, improvement and progress. We can emerge from the crisis stronger than we were before. But only if we can bring about a change of culture. For so long now, the profit motive and self-interest have driven our lives. Not only the lives of bankers. But also the lives of company executives. Of directors in non-profit organisations. And of politicians. And what has it brought us?

I think we should see this crisis as an opportunity to work together to make the economic and social order fairer, more balanced and more sustainable. To create a market system guided by values such as trust, solidarity and morality. No one lives in total isolation. All our actions are embedded in a social context. A context that we have neglected, unfortunately.

It is time we put an end to this. In the international political arena. In our own countries. And in business. Let us take a quick look at each of these three areas.

International political arena

First, the international political arena. I was very impressed by President Obama's speech to Wall Street last week. He clearly stated that the old habits that led us into the crisis are no longer acceptable.

That is one of the reasons I am so confident that at the G20 summit in Pittsburgh we can take an important step towards the culture change that the financial sector so badly needs. Business as usual is not an option. It is time to put an end to ingrained imbalances and excesses.

Stricter supervision, clear regulation, more transparency, better risk management and greater integrity and morality - that is the path we must follow. I think we can take the first key steps along this path in Pittsburgh.

To reform the existing system and bring about a change of culture, the global community must work together and agree on key principles. For example, by agreeing to curb reckless behaviour and perverse incentives. I find the existing bonus culture in the financial sector a real problem - and fortunately I am not alone. Let us recognise that pursuing short-term profit, focusing exclusively on our own interests and taking excessive risks have caused real misery. We can and must do things differently.

National level

In the Netherlands the banking sector has taken a major first step towards restoring trust. The Dutch Bankers' Association recently drew up a code that commits banks to the principles of prudent and sustainable banking. It contains agreements on limiting variable remuneration, introduces an ethical oath for bankers, and lays down standards for expertise and life-long education. This is unique in the world. By adopting the code Dutch bankers are showing that they are concerned not only with themselves but also with the moral and social context.

It is not only bankers who sometimes lose sight of the bigger picture. National governments are sometimes guilty of this too. One example is the introduction of protectionist measures. I am convinced that protectionism will frustrate long-term economic recovery. It obstructs free trade. It attests to the pursuit of pure self-interest. And it puts businesses in developing countries at an unnecessary disadvantage. In the social market system that I advocate, this issue warrants special attention. A fairer distribution of economic opportunities and prosperity is ultimately in the interests of us all.

Ladies and gentlemen,

Business

This brings me to my third and final point. The current economic situation offers an opportunity to change corporate culture. And to strengthen corporate ethics.

The crisis is reinforcing a trend in which consumers look at more than simply the price of a product. They also want producers to focus on people, the environment and society. They want producers to satisfy stakeholders as well as shareholders. They are interested in sustainability. In the long-term future.

Family businesses show that a long-term strategy is ultimately more profitable. In the Netherlands, family businesses are the silent engine of the economy. They account for half of Dutch GDP and 40% of jobs. Investments in these businesses are given time to yield a return. Investors are patient, which encourages calm and stability. Compare that with the situation in listed companies, which are ruled by short-termism. If quarterly figures are disappointing, this immediately causes concern. We must escape from the straitjacket of short-term thinking. We need to understand that in the long run patient capital always triumphs over speculative capital.

The achievements of the Dutch chemical group DSM clearly show that a long-term vision brings rewards. This year, DSM proudly rose to the top of the Dow Jones Sustainability Index for the chemical industry. Because it sees innovation and sustainable development as its core values. Because it does not allow disappointing turnover to jeopardise its contribution to the UN's World Food Programme. And because it has an intensive programme for developing leaders who not only talk about giving equal attention to people, planet and profitability, but genuinely do so.

Ladies and gentlemen,

DSM rejects prosperity at any price. And so should we. It's time for change. But also time for action. Action that puts an end to the get-rich-quick theory of life.

Now that I have outlined my own views, I would really like to hear what you think. So let me conclude with three questions:

• Do you agree that we need a change of culture in our social and economic life?
• What do you think should be done about the remuneration culture?
• What are you and your company doing to bring about a change of culture?

Thank you.