Resources
We conduct original research on the causes of short-term business decisions and work to find practical solutions.
Report
1 February 2014 - Since the 2008 financial crisis and the onset of the Great Recession, a growing chorus of voices has urged the United States and other economies to move away from their focus on “quarterly capitalism” and toward a true long-term mind-set. This topic is routinely on the meeting agendas of the OECD, the World Economic Forum, the G30, and other international bodies. A host of solutions have been offered—from “shared value” to “sustainable capitalism”—that spell out in detail the societal benefits of such a shift in the way corporate...
Report
23 January 2014 - The pressure on business leaders to deliver financial results in the short term has increased considerably since the economic crisis, according to a survey jointly commissioned by McKinsey & Company and Canada Pension Plan Investment Board (CPPIB)1 on time horizons in executive decision making.2 More than three‐quarters (79 percent) of the respondents told us that the time frame in which they personally felt the most pressure to deliver financial results was two years or less. And while 73 percent said that their companies should look...
Report
23 January 2014 - Short-term decision making runs counter to individual savers needs. Much of the capital in the chain originates with savers whose interests are long-term. Yet today few individuals’ directly invest their own savings into markets. Rather, the majority of capital works its way through the hands of multiple financial market participants before individual savers realize some return from the net cash received on their effective investments in corporations, multiple links down the chain from them. Unfortunately as capital weaves its way through this system, it is...