Because it’s a lot of work to check that repos contain no confidential information, and to sync internal and external repos if there is a need for some internal-specific stuff. Especially when most software is very specific - e.g. I work in data pipelines for accounting and our logic is specific to our accounting processes.

I think some industries like video games should absolutely do it though, where the turn-around time on products is much faster. The main objection is that it just helps competition (and asset-swap scammers, etc.) but I think that’s missing the bigger picture of more tooling and assets helping to grow the industry and labour pool as a whole.