The Atlantic

How to Stop Short-Term Thinking at America’s Companies

U.S. companies are hyper-focused on quarterly earnings. What can be done to push them to invest more in the years and decades ahead?
Source: Andrew Kelly / Reuters

There was a time, half a century ago, when what was good for many American corporations tended to also be good for America. Companies invested in their workers and new technologies, and as a result, they prospered and their employees did too.

Now, a growing group of business leaders is worried that companies are too concerned with short-term profits, focused only on making money for shareholders. As a result, they’re not investing in their workers, in research, or in technology—short-term costs that would reduce profits temporarily. And this, the business leaders say, may be creating long-term problems for the nation.

“Too many CEOs play the quarterly game and manage their businesses accordingly,” Paul Polman, the CEO of the British-Dutch conglomerate Unilever, told me. “But many of the world’s challenges can not be addressed with a quarterly mindset.”

Polman is one of a group of CEOs and business leaders that have signed onto the American Prosperity Project, an initiative spearheaded by the Aspen Institute, to

You're reading a preview, sign up to read more.

More from The Atlantic

The Atlantic5 min readPolitics
An Imperfect SAT Adversity Score Is Better Than Just Ignoring Adversity
The College Board’s simple, straightforward indicator will make schools pay attention to the tough odds some applicants face.
The Atlantic7 min read
The Lucrative Black Market in Human Fat
In 16th- and 17th-century Europe, physicians, butchers, and executioners alike hawked the salutary effects of Axungia hominis.
The Atlantic5 min readPolitics
A Lesson From 1930s Germany: Beware State Control of Social Media
Regulators should think carefully about the fallout from well-intentioned new rules and avoid the mistakes of the past.