A recent report published by Oxfam and ActionAid shows that 722 of the world’s biggest corporations collectively earned more than $1 trillion in windfall profits each year since 2021. The massive boost in their revenues was supported by soaring energy prices and high-interest rates.
The 722 companies raked in $1.08 trillion in 2021 and $1.09 trillion last year in windfall profits even as billions of people across the globe struggle to access food and clean water. As per the analysis, the average annual earning of the companies was found to be 89 per cent higher than the average of the last four years covering 2017 to 2020.
Windfall profits are defined as those exceeding by 10 per cent the average profits in the last four years. Experts generally believe that windfall profits should be highly taxed by governments across the globe to divert resources where they are needed the most.
Who are the biggest beneficiaries?
The 722 corporations include those from the pharmaceutical and energy sectors to banks and food companies. The 45 energy companies, listed on the Forbes list of the 2,000 biggest companies, collectively raked in $237 billion in average windfall profits over the past two years. This massive wealth generation led to the creation of a total of 96 energy billionaires with a combined wealth of nearly $432 billion.
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Furthermore, 18 food and beverages companies made $14 billion a year in windfall profits in the last two years, 28 pharma companies made $47 billion a year and nine aerospace and defence corporations made $8 billion in windfall profits.
This was when above 250 million people across 58 nations suffered acute food insecurity and a high cost of living crisis.
‘Government needs to act’
Experts believe the greediness of global companies is leading to massive poverty and cost-of-living crisis across the globe, including the developed countries.
Katy Chakrabortty, Oxfam’s head of advocacy, said, “These eye-watering excess profits are not only immoral, We are also seeing increasing evidence that a corporate bonanza is supercharging inflation, leaving millions of people in the UK and around the world struggling to pay their bills and feed their families.”
“When the windfall profits of 18 food and beverage corporations are more than twice the amount needed to cover the shortfall in life-saving assistance to tens of millions of people facing hunger in east Africa, it is clear governments need to act,” she added.
“We need to see windfall taxes introduced across the board and an end to this racket, where rich shareholders are rewarded at the expense of everyone else,” Katy Chakrabortty demanded.
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