The first rule of the Hippocratic Oath all doctors take is, "First, do no harm." Why did Theranos, Valeant and Turing assume so much risk? They focused on the short-term at the expense of their companies, their patients and the health care industry.
Weak leaders focus on all the things that are going wrong. Great leaders like Alan Mulally bring out the best in us. The most effective leaders apply the principles of positive psychology, ensuring their interactions with employees contain a healthy balance of positive and constructive feedback.
Trust is the foundation of American capitalism. Unfortunately, many activist investors have damaged that faith. The staying power of activists will depend on whether they are able to regain our confidence through sustained financial performance, heightened innovation, and greater long-term investments, not just immediate gains.
Many companies are making important contributions, but CEOs have less leeway than ever to make bold investments in their communities. Due to growing pressures from short-term shareholders and increasing regulations, companies have been severely constrained in making targeted, long-term investments that drive social change.
The pressures today have never been greater on chief executives and boards to produce short-term results and maximize shareholder value. The paradox of these pressures is that they may actually destroy long-term shareholder value if they force executives to cut R&D, capital spending, new ventures and expansion in emerging markets, thus constraining future growth potential.