Fligstein And Shin's: Article Analysis

Fligstein and Shin’s (2007) article explores the cause-effect relationship between shareholder value strategies and profitability. I believe, however, that we can go deeper and say that this relationship illustrates human nature itself and how we, as stakeholders or managers, are actually mostly the problem if we view shareholder value maximization as the path to profitability and hence success.

We tend to follow our own interests and have a short-term focus if our capitalistic system is incentivized in such a way. The emergence of stock options has amplified this effect because quick profits have become possible, contributing to increases in share prices. Seemingly easy solutions to increase profitability, such as laying-off employees,