Reports Corporate Power

Fighting Short-Termism With Worker Power

October 17, 2017

By Susan Holmberg

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 felt empowered enough to stake this claim.

Fighting Short-Termism With Worker Power 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.

Tags: Corporate Governance, Labor, Worker Power