Everyone Loses Out When Corporate Governance Falls by the Wayside

The Deepwater Horizon disaster is one example of a problem that afflicts many companies, she says. That problem is the idea that the company belongs to its shareholders and exists for one purpose only: to maximise wealth for those shareholders. Six years on from the deadly blowout, you do not have to look far for more examples of companies misbehaving and cutting corners, which subsequently hurts shareholders. Last week, Sports Direct faced anger from shareholders after the company accepted that it had not treated employees properly. The admission followed months of pressure on the retailer’s founder, Mike Ashley, and Sports Direct after the Guardian highlighted a climate of fear at the company’s Shirebrook warehouse in Derbyshire. As the revelations about the company began to batter its reputation, the share price fell and previously quiet stockholders emerged to voice their disquiet.

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