No more focus on shareholders' value?

Jack Welch, the much-celebrated father of the "Shareholder Value Movement" seems to have taken an about-turn, describing focus on quarterly profits as a "dumb idea"! 

Apparently, he now thinks, 28 years later, that executives and investors have given a misplaced emphasis to shareholder value after his speech in 1981! It is simply amazing how the global downturn has shaken the very foundations of wealth creation that capitalism is credited with. 

Though the validity of share price as the sole metric of company and management performance has been debated quite often and the recession no doubt calls for a radical rethinking of the role of management, the harsh criticism of shareholder value from one of its erstwhile champions is shocking to say the least. 

The original article in FT can be found here. Prof TTR has also discussed this article on his blog here.