Marty Lipton is again railing against "short-termism" in corporate governance, while confusing operational horizon short-termism (maximizing profits in the accounting sense in the short-term, which nobody advocates) with investment horizon short-termism (maximizing the stock price in the short-term, which is a plausible objective). The facile assumption that investment horizon short-termism leads to operational short-termism is seductive but largely incorrect, I argued in The Long and Short of Corporate Governance. Many thoughtful commentators disagree with my perspective that short (or long) investment horizon does not dictate short (or long) operational horizon, but to not even acknowledge the role of the market in the "long-and-short" debate isn't intellectually honest.
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