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Strong Dollar, Weak Thinking

Harvard Business Review

This puts downward pressure on stock prices because with lower EPS growth, shareholder expectations of future growth drop, lowering EPS multiples and hence stock prices. So foreign operations need to contribute meaningfully over the long term to shareholders’ 20 times expectations.

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We Can’t Study Short-Termism Without the Right Metrics

Harvard Business Review

The McKinsey Global Institute, in conjunction with FCLT Global, recently released research stating that long-term-oriented companies perform better than those that focus on short-term results. Getting the measurement right is central to providing convincing evidence on the debate over short-termism.

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Yes, Short-Termism Really Is a Problem

Harvard Business Review

With Hillary Clinton’s tax proposals to encourage longer-term investing , the debate over whether American business is too fixated on the short term has moved from the dimly lit offices of earnest policy wonks into the klieg lights of U.S. primary season. But that is far from true. ” A Review of Relevant Studies. .”

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How Incentives for Long-Term Management Backfire

Harvard Business Review

To hear long-term investors tell it, company executives have embraced short-term thinking like never before. Two obvious pieces of evidence: The use of earnings for share buybacks that cost more than they’re worth, and dividend increases that divert cash from long-term investment.

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Business Needs to Do What Government Can't

Harvard Business Review

Just under 1,000 companies account for half of the world's market capitalization, Eccles notes. In short, change would happen, but at a dangerously slow pace. Breakthrough requires an end to systemic inequities by opening up processes, information - and markets. Zeitz is also rolling out the EP&L across the holding group PPR.

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?Numbers Show Apple Shareholders Have Already Gotten Plenty

Harvard Business Review

Icahn later reduced his buyback request to $50 billion, and in April 2014 Apple’s board approved a $30 billion program to be carried out by repurchasing its shares on the open market — either by just buying shares outright or doing it indirectly via accelerated share repurchases. Apple is a company with phenomenal products and profits.

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Managing in an Age of Winner-Take-All

Harvard Business Review

Consider management actions such as cutting jobs and investment as a response to currency fluctuations and the resulting accounting impact of those cuts on earnings per share (EPS). Share buybacks are preferred to investment in innovation, entrepreneurship, and value creation.