Having made HKD1 billion in profit last year (and 500 million for the first half of this year), TVB decided to layoff 212 employees in this time of turmoil. Their reason is that they must be responsible to their shareholders.
TVB's decision probably makes sense on paper. With publicly listed entities, the shareholder is king. I guess I could sympathize with the layoffs if TVB was barely breaking even, but that doesn't seem to be the case. I just want to know when enough is enough.
I certainly have no right to judge TVB's decision. Perhaps they are planning for the gloomy outlook in upcoming years. Only they can project how much revenue next year will bring.
The TVB layoffs have brought to attention the subject of shareholder responsibility vs. social responsibility. Naturally, to stay attractive and keep investors coming, TVB wants to show shareholders that in times of turmoil, they know how to make the tough, unpopular decisions to keep that profit margin. Strictly business minded people will applaud this, stating that it keeps Hong Kong investment opportunities attractive.
On the other hand, where does it end? Shareholders are not the only ones fighting their way through a bad economy. The ones at the bottom of the ladder always suffer the most. When does a company put a hold on the profit margin, and decide to take care of their own people? I'm sure corporations understand what they are doing when they put people out in the cold in this economy. They have just never experienced it themselves.
No one is saying that we should tell TVB (or any other company) how to run their business. I'd like to ask, do investors only care about profit? If that were the case, nobody would care about child labor, poor working conditions, and minimum wage. If profit was the sole purpose of investing in a company, these issues wouldn't even be discussion topics. Can corporations look past the money and see the significance of social responsibility? Can investors do the same? People don't like the words "social responsibility". How about just calling it "taking care of your own", or "living through the thin as well as the thick". There will always be money to be made, but at what expense?
Furthermore, is TVB's reputation in the public eye at all important? Make an unpopular move, and there could be consequences (though likely minor consquences).
Personally, I would much rather put my money in a company that took care of society as well as their investors. A company that blindly cares about profit (especially in times like these) is not a company I would support.
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