Faculty News
Professor Richard Sylla's views on the "shareholder value" model and his co-authored paper with Prof. Ralph Gomory are highlighted
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Excerpt from The Boston Globe -- "By the 1990s, the notion that a CEO had an obligation to maximize shareholder value had become an unquestioned mantra taught in business schools; ordinary people assumed it was simply the way of the world. 'People think it was brought down from Mount Sinai by Moses, as the 11th Commandment,' said Richard Sylla, a professor who specializes in the history of financial institutions at NYU Stern School of Business, and the coauthor of a recent article in the journal Daedalus critiquing the notion of shareholder supremacy. 'If you’re younger than 50 or 60, you’ve lived in a world where everyone taught you that this is what a corporation is supposed to do—maximize profit and shareholder value. But the world used to be different.'The philosophy of shareholder supremacy, initially a reform to curb irresponsibility in managers, has ended up causing significant problems of its own, say Sylla and other critics."
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