23.02.20233 minutes reading time

How do the limits to growth and corporate growth fit together?

Growth has to be redefined. Purely quantitative growth should be replaced in favour of qualitative growth. For this, we need political and social framework conditions so that citizens and companies can move towards the future with equal security. Without social, political and technical innovations, economic innovations will not last. Everything has to work in harmony together. So this is a major task facing all of us.

What are the most common corporate mistakes that you have observed in recent years?

  1. Short-term thinking and action from managers who only think about their own careers, rather than the long-term development of the company.
  2. Remaining in existing structures and thought patterns instead of thoroughly renewing the company. 
  3. Unscrupulous business without consideration for the interests of employees, society and the environment.

How do you see entrepreneurial responsibility?

The social market economy and the rules of honourable trading should once again receive more attention. Freedom of economic activity and social responsibility towards all stakeholders are two sides of the same coin. However, the great majority of businesspeople do adhere to both of these principles.

How do you feel about the discussion on manager salaries?

I think the current debate is good and proper, since I don't feel it's fair that managers should collect high levels of compensation even for poor or non-performance. However, this is above all an issue that company shareholders and supervisory boards should address.

How do you see the role of government?

In a social market economy, the state has the important task of defining the framework through laws, and therefore sets the boundaries. For example, when I think of the financial industry, we are still a long way away from achieving everything that is required in terms of regulatory implementation. I think it’s good that Germany has taken the lead in stopping short-selling, for example, and I support the financial transactions tax, even though not all European countries are taking part.

How do you feel about developments in the financial markets?

Banks should return to their core business again, which is supplying the real economy with funding. There has to be an end to short-term profiteering by individuals at the expense of the global community. The risk position of banks and countries needs to be more tightly monitored. We also need institutions are empowered to make harmful kinds of speculative trading more expensive − or even suspend them.

In the debate on the fair distribution of wealth, there are demands for higher taxes on inheritances, assets and top incomes. Do you agree with these?

I don’t agree with repeated taxation of assets which have already been taxed. Taxing capital in this way would lead to a situation where medium-sized companies especially would have to pay taxes even if they made losses. This would cost growth and jobs. If the state has exhausted all cost-reduction options, I could imagine increasing the top tier of taxation. Anyone who is making decent profits, particularly as an entrepreneur, should also pay corresponding taxes, and I mean in Germany.

What will the USP of Germany as a business location be in future, in your view?

The advantage of Germany as a business location will continue to be its high innovative strength combined with well-known German virtues such as thoroughness, punctuality and good service.

What do you think about the introduction of minimum wages?

I am absolutely in favour of introducing minimum wages. However, these should be negotiated between unions and management and they should differ depending on sector and also by region. Only where collective agreements in particular sectors cannot be made binding for all, because fewer than 50 per cent of the employees are unionised, should the government get involved.

What does the euro mean to you?

We need the euro, so we should defend it. Germany and Europe require a strong lead currency alongside the dollar.

Do you like the idea of the United States of Europe?

I don’t think it’s sensible to go that far. It starts with the fact that in Europe – unlike the USA – we don’t all speak the same language. However, we should harmonize our financial and business policies more.

Prof. Dr. Michael Otto as


Prof. Dr. Michael Otto as