Firms adopted shareholder-value rhetoric selectively to protect executive discretion.

Evidence

By 2000, as stated by Lazonick & O’Sullivan (2000), maximizing shareholder value (MSV) had become a dominant ideology for corporate governance. Mission statements in the late 1990s announced a common focus on a single constituency: shareholders. Coca-Cola stated, “We exist to create value for our share owners on a long-term basis by building a business that enhances The Coca-Cola Company’s trademarks.” Sara Lee said, “Sara Lee Corporation’s mission is to build leadership brands in consumer packaged goods markets around the world. Our primary purpose is to create long-term stockholder value.” Yet corporate managers were notably selective in the types of prescriptions they adopted: While dediversifying, awarding stock options to executives, and taking on more debt were embraced, governance reforms that would limit the discretion of CEOs were generally avoided (Dobbin & Jung 2010). — Gerald F. Davis & Suntae Kim, Financialization of the Economy, 57

Categorization

• DEFINE: Illustrates the concrete meaning of ‘maximizing shareholder value (MSV)’ through actual corporate mission statements.
• SEED: The selective adoption of shareholder-value ideology could anchor an essay on how ideological movements get absorbed cosmetically while cutting against the grain internally.
• XREF: connects to: German firms deployed shareholder-value rhetoric symbolically without full implementation — Natascha van der Zwan, Making Sense of Financialization, 49; Shareholder value operates as discourse disconnected from actual firm performance — Natascha van der Zwan, Making Sense of Financialization, 49; Shareholder-value incentive pay enriched managers more than shareholders themselves — Natascha van der Zwan, Making Sense of Financialization, 54

Related

• German firms deployed shareholder-value rhetoric symbolically without full implementation (similarity 0.82)
• Shareholder value operates as discourse disconnected from actual firm performance (similarity 0.80)

Broader Connections

• German firms deployed shareholder-value rhetoric symbolically without full implementation #corroborates (0.95) — Natascha van der Zwan, Making Sense of Financialization, 49
• Shareholder value operates as discourse disconnected from actual firm performance #corroborates (0.80) — Natascha van der Zwan, Making Sense of Financialization, 49
• Shareholder-value incentive pay enriched managers more than shareholders themselves #qualifies (0.72) — Natascha van der Zwan, Making Sense of Financialization, 54