Pfizer’s planned offer for AstraZeneca is a poor test case for almost any big question about big corporate acquisitions. The weaknesses of everyone involved in the potential deal only bring out the futility of the whole idea that big companies have owners.
The would-be American acquirer, the British target, the UK government and whole pharmaceutical industry are all tainted. They are guilty, respectively, of a tax fixation, cutting research, empty words and inadequate drug discovery. So there is really no one with the moral authority to say whether this is a good deal.
But the whole debate is marred by the law, which leaves the final decision to only one group, the equity shareholders. The squealing politicians and whinging scientists can be cast as intruders, interfering with the rights of these owners. That is wrong. Shareholders should not decide, because the law is economically wrong. The typical large company does not have owners.
Yes, shareholders own some of the financial capital, and should protect their interests. But the shareholders’ capital contribution plays a relatively minor role in most quoted enterprises. The financial base is far less important than a long list of other assets: human capital, government protection, brands, reputation and technological expertise.
There is also a fundamental difference between a company, a human organisation, and property, which is stuff like cars and houses. Property can be used and sold at the owners’ will. Companies, like other human organisations, have a life of their own. Companies should be treated in the same way as a family, a church, a government agency or a voluntary organisation, as institutions with many social roles and responsibilities – and without any owners.