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Is Corporate Short-Termism Really a Problem? The Jury’s Still Out

Harvard Business

If they do, as many CEOs believe, this is a serious indictment of current corporate governance arrangements and has important policy implications. It finds that companies that take a long-term view perform better on many metrics, such as employment growth and shareholder return. I am not sure what to believe in this area.

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How Incentives for Long-Term Management Backfire

Harvard Business

But one other big factor has been hiding in plain sight: The efforts of corporate-governance activists and proxy advisers, empowered by the “Say on Pay” votes mandated by Dodd-Frank reforms, to stress transparency and pay for performance. Eventually, the company’s share price nosedived.