Is Corporate Governance Possible Without Losing Profits?

BlackRock CEO Larry Fink has come under fire this week for his comments chastising corporate America 

John Rekenthaler 29 January, 2018 | 9:38AM

BlackRock CEO Larry Fink's contention that corporate managements should aim for more than just maximising "shareholder value" was not universally acclaimed. Many people like the American system just as it is, thanks much.

One accusation was that Fink made a bull-market argument. It is easy to talk about how there is more to life than profits when the table legs are buckling from the weight of the feast. It is not so easy if the cupboard is bare.

Chicago business columnist Joe Cahill wrote: "Big-time investors and globe-trotting chief executives gladly extol social values when profits are surging and stock markets are hitting all-time highs. When earnings shrink and share prices descend, expect them to recall what Milton Friedman said about a company's one and only social responsibility."

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John Rekenthaler

John Rekenthaler  John Rekenthaler is vice president of research for Morningstar.

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