Monday, October 21, 2013

Archbishop comes down on energy firms

From an article in the telegraph:

The Archbishop urged firms to be "conscious of their social obligations", saying they had to to "behave with generosity and not merely to maximise opportunity".

Me: Providing that conditions are competitive and there are no principal-agent issues causing short-termisn, then maximising opportunity should be the sole goal of the private enterprise.

"They have control because they sell something everyone has to buy. We have no choice about buying it," he said. 'With that amount of power comes huge responsibility to serve society.

Me: Maximising opportunity is the best way to serve society. Oh and here is some other stuff that everyone has to buy: clothes, food, water. People selling this stuff may have control when they have monopoly power but they don't have control simply because the goods are essential to daily life. It's a question of competition.

"It is not like some other sectors of business where people can walk away from you if they don't want to buy your product and you are entitled to seek to maximise your profit.

Me: Customers may not be able to walk away from energy as a product but they can switch supplier.

It's surprising to see this commentary from an archbishop who has a background in the energy sector.

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