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japh,
"This is closer to the truth. But there is a conflict there. Shareholders wants quick profits while the board also have to look at what happens to the company in the long run."
I agree that there is a tendency for short term thinking. But, the board are hired by shareholders to work for them.
"Example: Microsoft wanted to buy yahoo. It would have been a quick win for the shareholders, but yahoo themselves felt that in the long run it was smarter not to sell."
Well, if I remember, it was Yang specifically acting as CEO who made the decision not to sell. And I think he let his personal pride get in the way. Shareholders could have fired Yang immediately, but he was himself a pretty large shareholder and carried a lot of pull.
"A filing from April 2009 shows that Yang had 33.6+ million shares in indirect ownership of Yahoo!"
http://247wallst.com/2010/02/11/jerry-yang-dumping-yahoo-shares-yho...
"Those in charge aren't in jail today, so I will have to assume that they didn't break any laws by not giving the shareholders the quick profit they wanted."
I doubt he broke any laws, but he did loose his job and probably his career (not that he really needs a job now-a-days).




Member since:
2005-11-11
It's boardmember's responsibility to act in the interests of shareholders. But it's the shareholder's responsibility to elect (or fire) the board members.
This is closer to the truth. But there is a conflict there. Shareholders wants quick profits while the board also have to look at what happens to the company in the long run.
Example: Microsoft wanted to buy yahoo. It would have been a quick win for the shareholders, but yahoo themselves felt that in the long run it was smarter not to sell.
Those in charge aren't in jail today, so I will have to assume that they didn't break any laws by not giving the shareholders the quick profit they wanted.