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Should Companies Retain "Strategic" Cash?

Harvard Business Review

This raises the question of whether retaining strategic cash makes economic sense and should be viewed as a legitimate corporate finance tool in today's environment. Strategic cash also can be used to finance long-term reinvestment programs in the business—which is especially valuable to companies in capital-intensive industries (e.g.,

Company 13
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What U.S. CEOs Should Do with the Money from Corporate Tax Cuts

Harvard Business Review

Our research and experience suggest that many executives underestimate the value of growth, specifically in today’s low-interest rate environment, and are thus missing out on a chance to make their businesses much more valuable than they are today. The cost of capital is at historic lows, averaging below 6% for most large U.S.

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When "Creative Destruction" Destroys More than It Creates

Harvard Business Review

When changes in the natural environment accelerate, so do the extinction rates of the Earth's creatures. Did it seem "creative" to Nokia shareholders when the company missed the smart phone wave despite having some of the early technology? real revenue and profit growth and earning their cost of capital has steadily declined.

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The Case for Investing More in People

Harvard Business Review

Managed by Q, a cleaning and office services company in New York City, decided to pay employees higher wages than the prevailing market rate. In turn, the company is achieving lower levels of employee and customer churn, and correspondingly lower employee hiring and customer acquisition costs.

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Why Europe's Carbon Woes Matter to the Whole World

Harvard Business Review

Europe''s $100 billion carbon market, an innovative force in the powerful carbon-reduction approach known as cap and trade, has ceased to function the way it''s supposed to. And it''s all because of a failure of political will in Europe to override the market''s built-in lack of flexibility and fix the imbalance between supply and demand.

Price 8
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Even for Companies, the U.S. Is Split Between Haves and Have-Nots

Harvard Business Review

Companies in the top one-fifth of profitability earn, in aggregate, about 70 times more economic profit (accounting profit less cost of capital) than those in the middle three-fifths combined, according to McKinsey’s database of 3,000 large, publicly listed, nonfinancial U.S. Consider what’s happening among corporations.

ROIC 8
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The Comprehensive Business Case for Sustainability

Harvard Business Review

Today’s executives are dealing with a complex and unprecedented brew of social, environmental, market, and technological trends. Yet executives are often reluctant to place sustainability core to their company’s business strategy in the mistaken belief that the costs outweigh the benefits.