Mistletoe is a parasitic plant. It attaches itself to its host (tree), to absorb its sap. Its crime can even lead it to kill, when its host is fragile (like the almond tree).
Mistletoe is a freerider who cares very little about the next day (the day when its host, its source of life, succumbs).
In economy, free riders can be assimilated to thieves, nevertheless, we must absolutely take away the cool and ecological aspect from them.
Let’s quickly see why!
It must be possible to transpose this reflection to the business world, because the business world is driven solely by economic interest (my profit, independently of the rest). In the micro-econmic world, altruism does not exist.
This management system aims at maximizing profits. Profits are set as an absolute objective, regardless of externalities. This thus leads to abuses such as tax evasion.
A reflection on the company as a free rider, would allow for the evolution of management methods, the objectives of the managers and the way in which stakeholders put pressure on the company.
An example of free-riding is tax evasion.
In fact, the taxes paid allow access to a market, a market that is organized and structured indirectly by the taxes paid there.
Fiscal optimization thus allows, by means independent of the market, to reduce the taxes paid in certain countries, while continuing to benefit from the market. These practices are associated with the free-rider issue:
Not every benefit is necessarily free ride and the limit between free ride and deserved benefits must be analyzed with regard to the externalities at stake in the company’s activity. Management reports should highlight these practices, in order to make shareholders responsible for the strategic choices and orientations of companies.