ESG is trendy and often well meaning but is it a threat to Australian business and the economy? What is the real reason for the rise of ESG? Professor Peter Swan of the University of New South Wales joins me and draws on decades of academic research experience into Australian corporate governance and recently on ESG to paint a clearer picture on what is driving it, who really governs Australian corporations (it’s not who you think), what’s gone wrong with corporate governance in Australia and what we do better on than most other countries. We reconsider the Friedman Doctrine and whether it applies today, and how changes in share ownership - such as the rise of index and superannuation funds - may influence Australian corporations.

Stay tuned for two segments at the end on Peter’s early research on consumer durables and monopoly and on his recently published book on his father - Trevor Swan, one of Australia’s greatest economists.

(00:00) Introduction

(1:43) Peter’s concern with Australian corporate governance

(07:41) An example

(10:39) Running a company in a state of ignorance

(16:55) Corporations are voting with their feet

(18:22) The ultimate cause of the shift in corporate governance

(22:06) The link between corporate governance SBS ESG

(25:29) What is the purpose of a corporation?

(29:46) Two paths for ESG

(33:09) Financial gravity as the real source of corporate governance

(44:30) What Australia does better than other countries with respect to corporations

(48:55) Peter’s work on durable goods and monopolies

(57:09) Peter on his father, Trevor Swan