The pursuit of shareholder value is attracting criticism—not all of it foolish
Are the critics really right to argue that modern capital markets invariably put
short-term results before long-term ones? Amazon has never found it hard to
attract investors, despite the way it ploughs its profits into long-term plans
for world domination. Plenty of other tech stocks are wildly popular despite
negligible short-term returns. And are companies always foolish to react sharply
to short-term warning signs? Nokia, a Finnish telecoms firm, would be much
healthier today if it had reacted more swiftly to market warnings, rather than
keeping a second-rate boss in place while Apple destroyed its business.
