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The analyses in the comments and in the article all assume shareholders are one large, homogeneous group with identical or very similar goals regarding investme
by bsbechtel 8y ago
The analyses in the comments and in the article all assume shareholders are one large, homogeneous group with identical or very similar goals regarding investment strategies. This is far from the truth, and realizing there are differing investors with different risk and time adjusted financial goals changes this debate drastically, and (imho) makes it largely irrelevant.
- muraiki 8y agoFrom the article: > Proponents of the managerial model embodied by Google worry about a different principal-agent problem. Rather than being concerned about managers ignoring investors, they are concerned that investors won’t serve the people who would benefit from the long-term success of the company. Those professional investors are both the principals for the CEOs but also the agents of many other shareholders. The hedge funds that pressured Apple are the dreaded “short-term” investors who are interested only in quick wins and don’t serve their longer-term beneficiaries, such as pension funds, that allocate capital to them in the first place. As investors, hedge funds are impatient, and, the argument goes, ruining the economy by shortening time horizons.