Short-termism

News

Optimal Short-Termism

Corporate short-termism has often been criticized because it could harm long-term performance. That is, managers arguably take actions that

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Dirk Hackbarth
Alejandro Rivera
Tak-Yuen Wong
12 February 2018

Video

Prof. Alex Edmans (London Business School) presents his paper on "The long-term consequences of short-term incentives", followed by a discussion of the paper by Mireia Giné (IESE Business School) at the "Corporate Governance And Ownership With Diverse Shareholders" conference at IESE Business School, Barcelona. The full paper and slides from the presentation and discussion can be downloaded here: https://ecgi.global/content/corporate-governance-and-ownership-diverse-s...

17 January 2020

Presentation

We show that following large permanent negative shocks, firms with more short-term institutional investors suffer smaller drops in sales, investment and employment and have better long-term performance than similar firms affected by the shocks. To do so, these firms increase their R&D and advertising expenses, differentiate their products from those of the competitors, conduct more diversifying acquisitions, and have higher executive turnover in the aftermath of the shocks, suggesting that they put stronger effort in adapting their business to the new competitive environment.

March 28 2024

Blog

Market short-termism: Its extent and its limits

Why ending quarterly reporting will not solve the stock market short-termism problem…but may be justified for other reasons

Topic

(Formerly: Directors’ Duties and Sustainable Corporate Governance)

ECGI took an active role in the consultation surrounding The European Commission's Corporate Sustainability Due Diligence Directive (CS3D) in 2021-2022.

Follow the legislation here.

Background:

(Formerly: Directors’ Duties and Sustainable Corporate Governance)

ECGI took an active role in the consultation surrounding The European Commission's Corporate Sustainability Due Diligence Directive (CS3D) in 2021-2022.

Follow the legislation here.

Background:

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28 March 2024

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