Marketing and the Bottom Line

Marketing and the Bottom Line

by Tim Ambler

Tim Ambler (now retired) was a professor at the London Business School. He was unique in that he was a marketing professor who was also a Chartered Accountant. Ambler contends that boards of directors should devote more attention to marketing. He puts a particular emphasis on brand equity and innovation.

“The point is simple: if you want to know what your future cash flow will look like, investigate where it comes from—the market… Survival depends on basic wealth creation. And wealth creation depends on how healthy the marketing is… Securing customer preference opens up the main cash flow for every business.” Continue reading “Marketing and the Bottom Line”

The Shareholder Value Myth

The Shareholder Value Myth: How putting shareholders first harms investors, corporations, and the public

by Lynn Stout

Business schools and law schools teach that the purpose of a corporation is to maximize shareholder wealth. “Shareholder wealth, in turn, is typically measured by share price—meaning share price today, not share price next year or next decade.” Lynn Stout (1957-2018), who was a business law professor at Cornell, makes the case that this is both untrue and harmful.

“United States corporate law does not, and never has, required directors of public corporations to maximize either share price or shareholder wealth… State statutes similarly refuse to mandate shareholder primacy… As long as boards do not use their power to enrich themselves, the [business judgment rule] gives them a wide range of discretion to run public corporations with other goals in mind, including growing the firm, creating quality products, protecting employees, and serving the public interest. Chasing shareholder value is a managerial choice, not a legal requirement.”

Continue reading “The Shareholder Value Myth”

Boards that Lead

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Boards that Lead: When to Change, When to Partner, and When to Stay Out of the Way

by Ram Charan, Dennis Carey, Michael Useem

“A board can be a destroyer or a creator of value.” This book presents an excellent analysis of how the inept boards of Hewlett-Packard, Motorola, and AIG destroyed shareholder value; interesting insights into the turnarounds of Apple and Tyco; CEO succession at Ford, 3M, and GlaxoSmithKline; and Procter & Gamble’s acquisition of Gillette. Continue reading “Boards that Lead”

Nonprofit Meetings, Minutes & Records

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Nonprofit Meetings, Minutes & Records: How to Run Your Nonprofit Corporation So You Don’t Run Into Trouble, Second Edition

by Anthony Mancuso

This book offers some good insights for anyone who serves on the board of a nonprofit organization, especially the board secretary. If the board of directors ignores its bylaws and state nonprofit laws, the organization could lose its tax-exempt status. Director liability is another concern. Continue reading “Nonprofit Meetings, Minutes & Records”

The Five Most Important Questions You Will Ever Ask About Your Organization

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The Five Most Important Questions You Will Ever Ask About Your Organization

by Peter Drucker et al

This book offers a strategic planning framework for nonprofit organizations. It can help board members set the direction by asking five questions.

What is our mission? The mission must reflect opportunities, competence, and commitment. Drucker cautions, “Never subordinate the mission in order to get money. If there are opportunities that threaten the integrity of the organization, you must say no.” Continue reading “The Five Most Important Questions You Will Ever Ask About Your Organization”