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In a world where information is ubiquitous and everyone is digitally connected, the short-term impact of decisions can become widely known within a matter of hours. Arguably, this is contributing to a growing trend towards short-term perspectives and objectives.
This heightened short-term focus is apparent at various levels of society – from politicians making policy for the next election, to the constant updating of information through social media, to the focus on short-term performance by some fund managers, investors and, in turn, public companies.
This publication considers how and why “excessive short-termism” can affect Australian public listed companies, as well as the Australian economy and broader society. Furthermore, it examines how boards can play a pivotal role in helping to reduce the impact of excessive short-termism on the companies they serve, while also promoting a longer-term outlook.
While this publication focuses on excessive short-termism in Australia, many of the observations and recommendations will also be relevant to boards of public companies in other countries.