Shareholder-value maximization went unanswered by any countervailing force

Evidence

The young manager would ultimately find his answers, but they were not what either of us had hoped for. Even as the pulp mill workers struggled and often triumphed, Hayek’s worldview was taking hold at the highest policy levels and Jensen’s operational disciplines were finding an eager welcome on Wall Street, which quickly learned to impose them on every public company. The result was a cost-down business model oriented to its Wall Street audience, which insisted on automating and exporting jobs rather than investing in the digital skills and capabilities of the US worker. The answer to the question Who knows? was that the machine knows, along with an elite cadre able to wield the analytic tools to troubleshoot and extract value from information. The answer to Who decides? was a narrow market form and its business models that decide. Finally, in the absence of a meaningful double movement, the answer to Who decides who decides? defaults entirely to financial capital bound to the disciplines of shareholder-value maximization. — Shoshana Zuboff, The Age of Surveillance Capitalism, 570

Categorization

• SEED: The contrast between what the pulp mill workers achieved and the Marxian/Wall Street answer that overrode them is a poignant story about a lost alternative future for American labor — the path not taken.
• XREF: connects to: Shareholder value maximization is defended as a social-welfare criterion. — Gerald F. Davis & Suntae Kim, Financialization of the Economy, 63; Shareholder value policies spread unevenly, aided by institutional preconditions and safety-in-numbers timing — Natascha van der Zwan, Making Sense of Financialization, 60; Shareholder value operates as discourse disconnected from actual firm performance — Natascha van der Zwan, Making Sense of Financialization, 49 (+3 more)

Broader Connections

• Takeover markets and institutional investors drove shareholder-value restructuring of corporations. #corroborates (0.85) — Gerald F. Davis & Suntae Kim, Financialization of the Economy, 31
• Shareholder value policies spread unevenly, aided by institutional preconditions and safety-in-numbers timing #qualifies (0.80) — Natascha van der Zwan, Making Sense of Financialization, 60
• Finance theory’s investor-centric view shaped American corporate governance toward value maximization #expands (0.80) — Donald MacKenzie, An Engine, Not a Camera, 1173
• Shareholder-value incentive pay enriched managers more than shareholders themselves #expands (0.78) — Natascha van der Zwan, Making Sense of Financialization, 54
• Shareholder value operates as discourse disconnected from actual firm performance #qualifies (0.72) — Natascha van der Zwan, Making Sense of Financialization, 49