Shareholder Value and Financialization: Consultancy Promises, Management Moves

Julie Froud, Colin Haslam, S. Johal, Karel Williams

    Research output: Chapter in Book/Report/Conference proceedingChapter


    Although shareholder value is the mantra that jumps out from the
    pages of the daily financial press, it is often a loosely defined and
    rhetorical concept, subject to little empirical study. It is also a
    powerful concept, originating in and finding identification with
    business consultants and promulgated via a series of metrics,
    implementation and incentive packages and a promise that
    purposive management action will be rewarded. This paper begins
    its analysis of shareholder value with the consultants who promote
    it, before turning to academic responses. The paper then presents
    empirics on microperformance and the meso limits to shareholder
    value which identifies gaps between what the consultants promise
    and the capital markets demand, and what corporate management
    can deliver. In the final section the paper argues that the process
    of financialisation, of which value based management is a part, is
    a contradictory one. Although attempts to increase shareholder
    value must disappoint at a meso and macro level, the persistent
    gap between expectations and outcomes can drive a series of
    management behaviours which do change the world.
    Original languageEnglish
    Title of host publicationCorporate Governance: Critical Perspectives on Business and Management
    Subtitle of host publicationVolume II: Anglo-American Corporate Governance
    EditorsThomas Clarke
    Number of pages33
    ISBN (Print)0-415-32910-8, 9780415329101
    Publication statusPublished - 2005

    Publication series

    NameCritical Perspectives on Business and Management


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