The pursuit of shareholder value as a stupid idea

Dan Gray has waxed lyrical about Jack Welch and others in the business strategy firmament turning their backs on the previous century’s predominant focus on “pursuit of shareholder value” as  the core driver of successful business.

Interesting to see that the first (apparent) argument for the pursuit of shareholder value came from none other than the near-canonised Milton Friedman who said it in 1970. (Forbes article here is an entertaining read on “Who’s money is it anyway?).

It’s interesting to see what the relentless focus on quarter by quarter shareholder returns has done to the long-term performance of capital:

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Another reason to advocate Purpose driven business…

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