The Error at the Heart of Corporate Leadership
https://hbr.org/2017/05/managing-for-the-long-term?
A better model, we submit, would have at its core the health of the enterprise rather than near-term returns to its shareholders.
The time has come to challenge the agency-based model of corporate governance. Its mantra of maximizing shareholder value is distracting companies and their leaders from the innovation, strategic renewal, and investment in the future that require their attention.
Shifting gears again: If a company wants to reorient itself toward long-term growth, what has to happen?
....The board of directors really has to buy into it, because not only are you changing your strategy, you’re changing your numbers. You must have a story to tell, for example: “For the next three years, we’re not going to deliver 10% EPS growth. It’s going to be 5% while we invest in the future. And that’s not going to pay off until after three years, so you’ll have to be patient.” You have to be very, very clear about it.
And then everyone—the board, the investors, the lab technicians, the salespeople—will watch you to see if you’re serious. It will take a lot of fortitude and determination. It’s not impossible, but it’s extremely difficult.