Shareholder Value

This paper examines the way new investor led collaborative initiatives are impacting on the integration of ESG information into mainstream investment processes and their potential to influence the standard valuation and investment practices of global fund managers. The objective is to identify how different approaches –be it collaborative initiatives, research platforms or incentive systems–contribute to the evolution of conventional investment practices and the integration of ESG information into the long-term shareholder value of investee companies.

The stakeholder management literature is dominated by the ‘shareholder value’ and ‘inclusive stakeholder’ views of the corporation. Each views the governance problem in terms of inter-functional conflicts between stakeholder groups, such as between investors and managers or managers and employees, and rests on the assumption of an idealized corporate structure characterized by the separation of ownership from management. Our review of corporate governance and stakeholder conflict shows that such functional-based characterization is too simplistic and fails to account for important intra-functional conflict. Through a comparative review that considers managerial, stakeholder and family systems of governance, we demonstrate that, while the modality of conflict varies by system, substantial intra-functional conflict is endemic to each. We integrate the findings of the agency and comparative stakeholder theories of corporate governance to offer an authority-based framework with three di...

This paper is concerned with the impact of introductory financial accounting courses on student perceptions of business objectives. The paper reports the results of a questionnaire survey of UK and Japanese university students which investigated their views at the start and end of an introductory financial accounting module. The views of Japanese students, in comparison with those from the UK, are of particular interest given evidence in the literature that traditional “social market” traditions in Japan are being influenced by Anglo-American “stock market” values. Our results are consistent with such a phenomenon in that Japanese students’ values regarding business objectives show significant changes that are not mirrored by changes in the perceptions of their UK counterparts. We suggest that accounting education is acting as a conduit for views more commonly held in Anglo-American societies.

Both ownership and regulation affect the behavior of utility managers. Private ownership rewards managerial decisions that enhance shareholder value. Regulatory incentives reward behavior that affects profits and costs. An empirical analysis of 24 Ukraine ...

An important issue currently facing the mining industry in Australia is the management and cost to the industry and other stakeholders of entry into and exit from towns and their communities. These costs can be environmental, social, economic, political or ...

This article re-examines the shareholder value revolution of the 1980s to challenge the dominant conception of the financialization of the firm. This transformation is widely interpreted as a re-alignment of corporate management in response to growing shareholder power and neoliberal managerial norms associated notably with agency theory. By contrast, we demonstrate how the financialization of the firm has its roots in the innovations made in 1960s America by a small group of outsider firms, the conglomerates, to challenge the corporate establishment. As we show, these firms pioneered financial techniques that profoundly transformed the nature of corporate strategy and launched a process of financialization as firms began to exploit the leverage financial markets could provide in various corporate contests. Taking stock of this historical lineage leads us to re-interpret the shareholder revolution of the 1980s. We demonstrate how the key features of this era: the orientation of firms towards capital market, the increase in shareholder activism, and the rise of agency theory, should be read as unintended outcomes of the success of financialized management and its destabilizing effects on corporate governance.

Grounding on the literature on resource dependence, board political capital and principal-principal conflicts, I conceptualize governmental minority shareholding as a governance strategy through which ventures access information about future policy shifts and better calibrate their decisions before policy implementation. I test these arguments on multi-country firm-level longitudinal data about European venture capital (VC)-backed and comparable non-VC-backed companies. By means of a difference-in-differences methodology and exploiting the staggered announcement of tax reforms across countries, I show that public VC-backed companies after a tax reform announcement show higher productivity than non-VC-backed ventures, and this effect lasts four years. After decomposing productivity, the post-announcement effect of public VC backing is mainly due to both an output effect (sales value increase) and an enhanced efficiency in the labor factor.

El presente documento plantea un análisis comparativo de las medidas que vienen siendo adoptadas en Francia y en Colombia con el fin de racionalizar el gobierno de las empresas estatales. Pese a la política de privatizaciones que se ha implementado en los dos países desde mediados de los años ochenta, el  rol  del  Estado  como  accionista  de  empresas  públicas  o  de  empresas  de  economía mixta tiene todavía un peso económico considerable. Se estudian las políticas sobre el Estado accionista, las instituciones que en ese marco se han adoptado y las influencias que han sido determinantes para su adopción. Se reflexiona sobre la forma en que las políticas adoptadas han pretendido superar la búsqueda de dos objetivos que, en principio, parecen antagónicos: de una parte, que el Estado se comporte como accionista privado que busca la rentabilidad de sus inversiones, y de la otra, que atienda el objetivo de la protección de interés general. Se concluye que la institución demanda un análisis  reflexivo  en  el  que  se  proteja,  pero  al  mismo  tiempo  se  limite,  la  racionalidad propia de los sistemas jurídico, económico y político

Marketing managers face increasing pressure to justify any strategic action with financial metrics that facilitate comparative evaluations with alternative options. Using event study method, the authors focus attention on the impact of high-profile quality achievement awards on the stock prices of the award-winning firms. Two types of awards are investigated: the Malcolm Baldrige National Quality Award (MBNQA) and J. D. Power and Associates Awards (JDPAA). Previous event studies found no major impact of MBNQA announcements on the stock price of MBNQA winners; in contrast, this study’s results show that these awards generate significant shareholder value for MBNQA winners. With respect to the JDPAA, the authors— analyses did notfind any such impact in the Automotive, Travel, and Finance categories. Multiple regression analyses suggest that firms with higher amounts of intangible assets are more likely to create shareholder value. Implications of the results for different decision horizon perspectives are derived.

... Lester W. Johnson, Mt Eliza Business School, Melbourne, Australia. Abstract. ... Boudreau, JW, Ramstad, PM (1999), "Human resource metrics: can measures be strategic?", in Wright, PM, Dyer, LD, Boudreau, JW, Milkovich, GT (Eds),Research in Personnel and Human Resources ...

Hoewel over het streven naar het creëren van 'aandeelhouderswaarde' veel is geschreven, is weinig onderzoek gedaan naar de opkomst en eerste verspreiding van deze bedrijfsstrategie. In dit artikel onderzoeken we aan de hand van open‐ bare bronnen als de Wall Street Journal en de Institutional Investor wanneer en op welke wijze het concept van 'aandeelhouderswaarde' opkwam en hoe het zich in eerste instantie in de VS heeft verspreid. Zowel de opkomst als de verspreiding van 'aandeelhouderswaarde' zijn vanuit economisch sociologisch perspectief te begrijpen vanuit de veranderende machts-en afhankelijkheidsverhoudingen waarin ondernemingen zijn ingebed. De diepe economische recessie rond 1980 leidde tot een crisis van de heersende managementopvattingen, bood nieuwko‐ mers de kans om alternatieve bedrijfsstrategieën te propageren, en daarvan werd het model waarin 'aandeelhouderswaarde' centraal stond dominant. De pleitbe‐ zorgers van het aandeelhoudersbel...

Dieses Papier betrachtet den Effekt der Umwelt- und Sozialperformance europäischer Unternehmen auf deren Shareholder Value. Der Shareholder Value wird dabei mit der durchschnittlichen monatlichen Aktienrendite zwischen 1996 und 2001 operationalisiert. Die Studie basiert auf zweistufigen ökonometrischen Verfahren, die neuere finanzökonomische Erkenntnisse (insbesondere auch das Multifaktormodell nach Fama und French, 1993) einbeziehen. Die Abbildung der Nachhaltigkeit erfolgt einerseits durch eine Bewertung der ökologischen und sozialen Risiken der Branche, in der das Unternehmen wirtschaftet, andererseits durch eine Beurteilung der ökologischen und sozialen Aktivitäten eines Unternehmens im Vergleich zu den anderen Unternehmen derselben Branche. Es ergibt sich ein signifikant positiver Einfluss einer hohen Umweltperformance der Branche, in der das Unternehmen tätig ist, auf den Shareholder Value. Eine entsprechend hohe soziale Nachhaltigkeit der Branche besitzt demgegenüber einen ne...

In 2000, when companies across the globe were scrambling to decode and implement the enigmatic new business strategy "Customer Relationship Management" (CRM), I had already spent a decade reengineering businesses to integrate this breakthrough structure into their DNA.  Buzzwords come and go, but when one of them promises to build shareholder value by driving customer acquisition, retention and profitability to unprecedented levels across the enterprise, business leaders latch on.  And they did.

In a piece I wrote that March for Customer Interface Magazine entitled The Value of Long Engagements, on what would later become Customer Experience Management, I took a back-to-basics approach and refocused the buzz on the customer as partner.  From partnership springs loyalty, retention, rising lifetime value and, consequently, shareholder value.  Start driving cross-functional process changes to align business processes around the customer and you'll be headed in the right direction.  Easier said than done, or I wouldn't have seen the need to write my book Upgrading the Customer Matrix a decade later in 2010.

Today, with more than twenty years of experience as Chief Customer Officer and Marketing Operations Turnaround Leader under my belt, I am helping companies supercharge profitable growth as a management advisor, board director and private investor.  The low-hanging fruit is long gone.  What's left are the hard problems to solve caused by shaky foundations, rapid growth and antiquated business processes.

For turnaround leaders like me, this is the really fun stuff.

By determining the strategy of a not-for –profit organization (whether an NGO or an educational organization) it is often not possible to determine a customer, an individual or group who pays for the service or product offered. Stakeholder analyzes can help to answer the question: For who are we doing what we do? What is our value-offering to whom?

Although much has been written about the conception of ‘shareholder value’, its rise and spread have not been properly researched. In this article we examine when and how the concept of shareholder value arose and spread in the United States. From an economic sociological perspective both the rise and spread of ‘shareholder value’ can be understood as a function of the changing power and dependency relations in which firms are embedded. The deep economic recession around 1980 led to a crisis in the prevailing management beliefs, offering newcomers the opportunity to promote alternative business models. The spokesmen of the shareholder value conception were originally wealthy outsiders, corporate raiders, who used the economic crisis to acquire shares in undervalued firms under the threat of restructuring and selling them. These controversial ‘hostile’ takeovers were accompanied by a sharp critique of established management, which would compromise shareholders’ interests, whereas maximizing shareholder value should be their only objective. Under the Reagan administration, the lucrative operations of corporate raiders gradually became a more legitimate type of investor behaviour for public pension funds. These funds had few ties to the established management and considered themselves disadvantaged because often only corporate raiders profited from the advertised takeovers, while other shareholders did not. The tensions between raiders and public pension funds led to the organization of public pension funds and the newly founded Council of Institutional Investors (1985) became a leading player. Because managers found profitable ways to adapt to the new balance of power, the shareholder value ideology rapidly spread through the economic field with the result that from the mid-nineteen eighties onwards, the alliance between top managers and large shareholders around the creation of shareholder value became the dominant business strategy of North American firms.

"Companies must give a living wage to workers everywhere if they are to merit the “CSR” label.

After decades of evolution, CSR remains a useless societal instrument to make business responsible for the impact of its economic activity on its sphere of influence."