Shareholders vs America

…while delivering big returns to shareholders over time is great (it is, in fact, Collins’s chief measure of “greatness”), focusing on shareholder value won’t get you there. That’s what Jack Welch was getting at, too. In a complex world, you can’t know which actions will maximize returns to shareholders 15 or 20 years hence. What’s more, most shareholders don’t hold on to any stock for long, so focusing on their concerns fosters a counterproductive preoccupation with short-term stock-price swings.

It might not make the company great, but it certainly makes stockholders (and CEO’s who have pay tied to stock performance) wealthy.

The question is, how do you resolve this particular externality?

How Shareholders Are Ruining American Business – Justin Fox –The Atlantic.

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