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.
Another convert...
Answers
We are talking Wells Fargo, the bank that was busy ripping off their customers so the shareholders felt the bump in the shareprice??
Shouldn't the answer be that shareholders change their demands from quarterly earnings to lifelong returns?
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"
"....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.
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.
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.