Today sees a supportive follow-up in the Financial Times to yesterday’s posting about LloydsTSB, and its willingness to rebuff those who parroted the ‘shareholder value’ mantra. The man who led the bank’s director development programme reveals that its former Chairman, Sir Brian Pitman, ‘drummed into us that the board’s main focus was to ensure continuing economic value added by balancing three seemingly incompatible issues:
- the reasonable demands of the shareholders
- the cost of capital
- ensuring the long-term health of the business.
In addition we had to have the professionalism and moral courage to say “No” to any unreasonable demand of the owners and to be ready to resign if necessary.’