From shareholder primacy to stakeholder capitalism

For many years, the conventional wisdom held that corporate executives should focus on maximizing shareholder value, and this goal was reinforced by compensating executives with stocks.4 However, these strategies have a number of flaws. They create a bias towards short-term results (such as quarterly earnings) at the expense of longer-term prioriti

A company’s health—not its shareholders’ wealth—should be the primary concern of those who manage corporations.