Fighting Short-Termism with Worker Power

By Susan R. Holmberg |

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This paper asks, “Can Germany’s co-determination system fix American corporate governance?” Prioritizing immediate increases in share price and payouts at the expense of long-term business investment and growth—a behavior we refer to as short-termism—has driven the inequality crisis in America and weakened our economy. By comparing the German stakeholder system of co-determination to corporate governance in the U.S., we find that emboldening workers with legitimate stakeholder power can help hold back the forces of short-termism.

Workers especially, who are investing in companies with their own labor on a daily basis, have a legitimate claim as corporate stakeholders, and it will serve companies, and society more broadly, if we—on the left at least—felt empowered enough to stake this claim.

Fighting short-termism by Roosevelt Institute on Scribd

Susan Holmberg is a Fellow at the Roosevelt Institute.