Financialized accounts: A stakeholder account of cash distribution in the S&P 500 (1990–2005)
S&P 500 companies are distributing an increased share of cash resources to shareholders relative to other stakeholder groups. Jensen (1986) argued that in a mature corporate sector, where growth is difficult to find, managers will tend to invest in projects where the net present value (NPV) of future cash-flow from those investments is negative and, as such, managerial calculations are working against the interests of investors. Jensen (1986) suggests that a combination of incentives, rules and contractual obligations could be employed to force managers into disbursing cash rather than reinvesting in projects with a low return. Jensen (1986) also indicates ...