From John Kay’s Obliquity:
Welch [CEO of General Electric from 1981 to 2000] was not just America’s most admired businessman but a darling of Wall Street. The rise n the market capitalisation of GE during Welch’s tenure represented the greatest creation of shareholder value ever. Ten years into retirement, he told the FT:
‘Shareholder value is the dumbest idea in the world’
Elaborating his thought to Business Week a few days later, he explained:
The job of a leader and his or her team is to deliver commitments in the short term while investing in the long term health of the business. Employees will benefit from job security and better rewards. Customers will benefit from better products or services. Communities will benefit because successful companies and their employees give back. And obviously shareholders will benefit because they can count con companies who will deliver on both their short term commitments and long term vision.