Balancing Short-Term and Long-Term Goals for Pension Fund Shareholders

Short-term and long-term results do not contradict each other, but they are different and need to be balanced. The new corporation must balance short-term gains and the long-term interests of pension fund shareholders. Focusing solely on short-term results endangers the interests of pension fund shareholders. Crucially, the requirement for absolute commercial income superiority has enabled shareholder sovereignty. This has brought the social function of the corporation to the forefront. The new shareholders that emerged in the 1960s are not capitalists in the traditional sense. They are salaried employees who, upon retiring, hold a stake in the business through the pension fund. In 2000, U.S. pension and mutual funds acquired large shares in major American companies. This allowed shareholders to expect current rewards, but the need to maintain stable income after retirement makes people consider the future value of their investments. Therefore, corporations, as sources of pension fund assets, must pay attention to both short-term and long-term commercial results. These two aspects do not contradict each other but must be balanced. TIP OF THE DAY Manage the company to achieve both short-term and long-term results to satisfy the interests of pension fund shareholders.