The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public

‘Shareholder value is a result, not a strategy . . . Your main constituencies are your employees, your customers and your products. Managers and investors should not set share price increases as their overarching goal . . . Short-term profits should be allied with an increase in the long-term value of a company.’25

Executives who complain about how undervalued their firm’s shares are or who opine about its true worth are probably more concerned with the value of their options than with making solid, long-term business decisions. Self-promotional managers, meanwhile, are not likely to make decisions that are in the best interests of long-term shareholders. If