4 ms·

Ok, so add the phrase "I believed that I was enhancing shareholder value" to whatever the thing is that you're doing. People get fired all the time based on bu

by jbooth 13y ago

Ok, so add the phrase "I believed that I was enhancing shareholder value" to whatever the thing is that you're doing. People get fired all the time based on bullshit performance improvement plans that come down to "pissed off the manager". I've personally been put on PIP the day after saying some impolitic things because of, officially, a bunch of 2 year old tickets in the bug tracker that were never going to be fixed. Fudging your justifications is a time-honored tradition. How come people are so loathe to do it when 'the shareholders' are involved? EDIT: Was googling and found this: http://truthonthemarket.com/2010/07/27/the-shareholder-wealth-maximization-myth/ http://truthonthemarket.com/2010/07/27/the-shareholder-wealt... There's apparently precedent for very wide latitude given to 'business judgment'. You can do whatever you want as long as you say "I thought I was enhancing shareholder value in the long term" afterwards. This does not explain the meme I referenced above which seems to go way beyond legal CYA into actual moral beliefs in business culture.

ChuckMcM 13y ago
Interesting link, I think the author missed out the part that created Sarbanes-Oxley (SOX) which is where officers of the company have to sign off, on threat of imprisonment, what strategy the company is pursuing. There was a reason it was called : "Public Company Accounting Reform and Investor Protection Act" you see protecting the Investors was another way of saying "protecting the shareholders" and the only protection they care about is that the securities they hold in a company don't lose value. My experience when I rolled over my 401k into a self managed IRA, one where my financial advisor is buying / selling securities to maintain a specific mix but actually holding the securities in my name, was that I got to see just how many lawsuits were being filed on behalf of shareholders who felt they weren't being protected enough. That said, the fact that you were poorly managed has more to do with your management than with the concept of shareholder value. Management is hard, its different than a job where you design/build/program things, and peoples ability to do it varies widely. I can certainly understand the idea that a poor manager had developed a crutch of using 'shareholder value' as an excuse for their actions, just like some use 'because I'm the boss' for theirs. My goal was to point out that there are rules and regulations in place that put officers and executives at a company at risk of sanction, either financial or criminal, if they do not actively protect the interests of the people who have invested in their company, their shareholders.
- jbooth 13y ago
  My point was more about justifications on paper for things you want to do for other reasons rather than being butthurt about a bad manager in ancient history. And I see your points. I'm just taking issue with the fact that business culture seems to value protecting shareholders as a moral imperative to the extent that you're obligated to be a sociopath towards your employees, customers and society at large. It seems to me that this moral imperative goes beyond legal issues and into the actual ethical system of the business community.

by jbooth 13y ago

ChuckMcM 13y ago

Interesting link, I think the author missed out the part that created Sarbanes-Oxley (SOX) which is where officers of the company have to sign off, on threat of imprisonment, what strategy the company is pursuing. There was a reason it was called : "Public Company Accounting Reform and Investor Protection Act" you see protecting the Investors was another way of saying "protecting the shareholders" and the only protection they care about is that the securities they hold in a company don't lose value. My experience when I rolled over my 401k into a self managed IRA, one where my financial advisor is buying / selling securities to maintain a specific mix but actually holding the securities in my name, was that I got to see just how many lawsuits were being filed on behalf of shareholders who felt they weren't being protected enough. That said, the fact that you were poorly managed has more to do with your management than with the concept of shareholder value. Management is hard, its different than a job where you design/build/program things, and peoples ability to do it varies widely. I can certainly understand the idea that a poor manager had developed a crutch of using 'shareholder value' as an excuse for their actions, just like some use 'because I'm the boss' for theirs. My goal was to point out that there are rules and regulations in place that put officers and executives at a company at risk of sanction, either financial or criminal, if they do not actively protect the interests of the people who have invested in their company, their shareholders.

jbooth 13y ago
My point was more about justifications on paper for things you want to do for other reasons rather than being butthurt about a bad manager in ancient history. And I see your points. I'm just taking issue with the fact that business culture seems to value protecting shareholders as a moral imperative to the extent that you're obligated to be a sociopath towards your employees, customers and society at large. It seems to me that this moral imperative goes beyond legal issues and into the actual ethical system of the business community.