Shareholder Value vs. Sustainability
Maximizing shareholder value is often perceived as being in opposition to sustainability efforts. According to Lynn Stout’s book, The Shareholder Value Myth, focusing too much on shareholder value can harm all other stakeholders and there is, in fact, no legal requirement for shareholder value to be maximized. A complex systems approach is more suitable; such a lens, according to entrepreneur Richard Lawton, shows that doing what is best for the physical and social environment is what makes a sustainable company. Pretty simple, eh? Putting this into practice, says Lawton, requires adaptive leadership, a triple bottom line ethos, and a willingness to re-evaluate values and goals, all at the board level. Move over, false dichotomies, it’s time for win-win solutions!