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Another convert...

Let this sink in for a bit....

"When you put your shareholders first – I hope Warren Buffett isn't listening by the way – but when you put them first, then you're going to make mistakes. Because you're going to make short-term decisions that aren't focused on creating a long-term, successful company," Tim Sloan - Wells Fargo Co-CEO

The shareholder primacy and the maximization of shareholder wealth concepts takes another hit.

I hope it is not just lip service.

Answers

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

We are talking Wells Fargo, the bank that was busy ripping off their customers so the shareholders felt the bump in the shareprice??

Steve Sheridan
Title: Associate
Company: Dean Lewis Associates
(Associate, Dean Lewis Associates) |

Shouldn't the answer be that shareholders change their demands from quarterly earnings to lifelong returns?

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

The problem with our country/world is Wall Street works solely on what you did last QTR. The PE/VC world works on 5 years or less.

The Going Concern Principle needs to be re-written with a caveat as to "as only as long, but no longer on average 5 years, to sell the business"

EMERSON GALFO
Title: CFO
Company: C-Suite Services
LinkedIn Profile
(CFO, C-Suite Services) |

"....change their demands from quarterly earnings to lifelong returns?"

It is still PROFIT motivated. I have always held the perspective that PROFIT is just a result and NOT a goal/motivation. In that same light, VALUE CREATION should also be viewed separately from profits/returns.

EMERSON GALFO
Title: CFO
Company: C-Suite Services
LinkedIn Profile
(CFO, C-Suite Services) |

As a P.S.

I think that the best business perspective model (how you treat shareholders, value creation, risks) we have right now is AMAZON.

As a testament, Buffett called the Amazon CEO "the most remarkable business person of our age" during an interview with CNBC.

Steve Sheridan
Title: Associate
Company: Dean Lewis Associates
(Associate, Dean Lewis Associates) |

I see what you mean Emerson. Wells wouldn't have got into their messif they figured out what their customers value. I wouldn't be surprised if honesty is high on that list.

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