article thumbnail

Sustainable Investment Funds Can Encourage Worse Behavior

The Horizons Tracker

Subsequently, leveraging historical data, the researchers evaluated the responses of the highest and lowest polluting groups to fluctuations in their capital costs, an impact similar to the objectives of the sustainable investing movement.

article thumbnail

The Complexity of Business Communication

CoachStation

Compare Michael Porter’s competitive advantage definition: “Competitive advantage, sustainable or not, exists when a company makes economic rents, that is, their earnings exceed their costs (including cost of capital).” Is change communication in your organisation more like the first example or the second?

Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

What Shareholder Value is Really About

Harvard Business Review

It is now in vogue to dismiss the idea that creating shareholder value should be a CEO's guiding objective. Concepts like "societal value," "shared value," and "customer capitalism" are offered as desirable and more enlightened substitutes. The objective is to build value and then let the price reflect that value.

article thumbnail

The Case for Investing More in People

Harvard Business Review

For too long, business objectives and management philosophies have focused on efficiency over productivity. Others, such as ANZ, the Australian-based banking giant, have committed to adopting Agile at scale in less than a year, following some of the proven practices used by Spotify , the music streaming company.

article thumbnail

Divestment Alone Won’t Beat Climate Change

Harvard Business Review

Divestment can theoretically address this market failure by limiting investment by the fossil fuel industry by depressing company valuations and thereby increasing the cost of capital. For many companies, most of the capital expenditures are financed from internal cash flows and bank financing.

article thumbnail

Divestment Alone Won’t Beat Climate Change

Harvard Business Review

Divestment can theoretically address this market failure by limiting investment by the fossil fuel industry by depressing company valuations and thereby increasing the cost of capital. For many companies, most of the capital expenditures are financed from internal cash flows and bank financing.

article thumbnail

4 Ways Leaders Can Get More from Their Company’s Innovation Efforts

Harvard Business Review

A recent McKinsey report found that while 84% of corporate executives think innovation is key to achieving growth objectives, only 6% are satisfied with the innovation performance of their firm. For any business to succeed over the long term, it must earn a return that exceeds its cost of capital. That’s quite a mismatch.