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Article Review For Management

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Management

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Homework

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creary0999

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Running head: MANAGEMENT ARTICLE REVIEW 1

Management Article review

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Institution

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MANAGEMENT ARTICLE REVIEW 2

Management Article Review

he Topic of the article to be reviewed in this paper is "How CEOs became Takers and not

makers." Professor William Lazonick, the author of the article, claims that the business leaders in

US claim to be adding value to the society, economy and the shareholders yet they take the value

from them through share buy-backs. The main point of the article is a conflict of interest by the

senior executives of businesses. The intended audience for the article are the shareholders, the

corporate leaders, and the general public especially those who are interested in corporate

investments. The Arthur places some argument that supports the main point of the article. The

author says that CEOs conduct insider trading deals to benefit from the shares they hold for the

company.

The article explains how firms suffer from declining shareholders value, net

disinvestment, reduced capacity to innovate, job destruction, and workers exploitation, runaway

executive compensation, inequalities, economic stagnation and windfall gains for activist

investors. The author provides statistics as evidence and in support of the main point of the

article. Looking at the argument placed, my opinion is that the author's argument is logical.

Many firms have been experiencing failure due to the actions of the managers who tend to

pursue their interest and overlooks the interest of the shareholders. Share buybacks are only

justifiable when the share price is below the intrinsic value, and the business is in apposition to

buy the shares. There have been cases where the shares are bought back even when the price is

very high. The authors give an example that more than $2.4 trillion shares made through the

open market are executed when the share value is high. The CEOs buy the shares claiming that

they do not want to dilute the ownership of the business however that is not always the case. I,

therefore, agree with the findings of this article.

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Running head: MANAGEMENT ARTICLE REVIEW Management Article review Name Institution 1 MANAGEMENT ARTICLE REVIEW 2 Management Article Review he Topic of the article to be reviewed in this paper is "How CEOs became Takers and not makers." Professor William Lazonick, the author of the article, claims that the business leaders in US claim to be adding value to the society, economy and the shareholders yet they take the value from them through share buy-backs. The main point of the article is a conflict of interest by the senior executives of businesses. The intended audience for the article are the shareholders, the corporate leaders, and the general public especially those who are interested in corporate investments. The Arthur places some argument that supports the main point of the article. The author says that CEOs conduct insider trading deals to benefit from the shares they hold f ...
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Tags: analysis Article review management manageemnt