How to build an alliance against corporate short-termism

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September 2026

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How to build an alliance against corporate short-termism

Corporate short-termism has long been a thorn in many a manager’s side, with pressure to deliver short-term earnings often coming at the expense of long-term value creation. And while short-term investors tend to hog the spotlight, they represent only a minority of a company’s shareholders. In reality, about 75 percent of stocks are owned by long-term investors, including those the authors of this 2017 classic call intrinsic investors. These savvy shareholders maintain a deep understanding of a company’s value and have an outsize influence on its share price over time. Their willingness to make large investments, even in the face of short-term volatility, can give companies room to create lasting value.

So how can executives curb pressure from short-term investing and strengthen their strategy for sustained performance? It begins with rigorously pursuing long-term value creation even if it means sacrificing short-term earnings. Executives should also communicate proactively with investors, educating them about the company’s advantages and its plans to build on those advantages. They should resist artificial moves to meet consensus expectations and fuss less over missed estimates when the company’s broader strategy remains on track. Finally, executives can rethink their quarterly earnings calls, using that time to remind investors about the company’s longer-term goals.

Teaming up with intrinsic investors can help companies avoid the lure of short-term gains while keeping their eyes on the long-term prize. For more, read “How to build an alliance against corporate short-termism.”

Prioritize long-term value

Read our latest thinking on this classic topic

What a new investor survey reveals about consensus estimates

Results from McKinsey’s 2026 Global Investor Survey reinforce a key insight from the 2017 classic: Respondents are less worried about missing consensus estimates if a company’s long-term outlook remains sound. What matters most is consistent execution against a credible long-term strategy. Respondents also want more financial detail from quarterly calls, and they’re increasingly turning to AI tools to analyze company reports and disclosures. Read our latest insights on the topic from McKinsey’s Jennifer Heller, Ryan Davies, Sébastien Lacroix, and John Evers. And for more of McKinsey’s best thinking for CFOs and other finance leaders, read our special 25th-anniversary edition of McKinsey on Finance.

Sharpen your investor communications

—Edited by Drew Holzfeind, senior editor, Chicago

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