We are fascinated with this month’s lead article in Harvard Business Review Ten
Ways to Create Shareholder Value (subscription required for full article
but you can get the abstract here or contact
me for more details.)

In one way, we really wonder how ‘shareholder value’ became such unchallengeable
corporate orthodoxy. We wonder how people working in corpotations can ever
be motivated with the goal of making money for someone else. But that’s what
we expect them to do. We expect them to turn up at work every day and think
to themselves "how can I make more money for shareholders today." We expect
them to be over the moon with this prospect. Everything else they may put their
heart and soul into is expendable in the service to shareholder value. Even
their own jobs are expendable to this purpose. Then we treat them with disdain
because they are lazy and they don’t have any commitment to the corporation.

On the other hand we know how this came to be — see Agency Theory and Shareholder Value.

Given all that at least Harvard Business Review turns the emphasis from short
term to long term value. A small step. A step nevertheless.