article thumbnail

Adapt Your Strategy to Higher Interest Rates

Harvard Business Review

To do that, executives need to rediscover the concept of economic profit (EP) — that is, revenue minus not just operating and administrative costs, but also the cost of the capital needed to produce that revenue.

EPS 25
article thumbnail

Business Needs to Do What Government Can't

Harvard Business Review

Breakthrough Finance. PUMA has led the field; its then-CEO Jochen Zeitz conceived an Environmental Profit and Loss (EP&L) for the company with PwC and Trucost. Zeitz is also rolling out the EP&L across the holding group PPR. Breakthrough involves a shift to new types of impact investment.

EPS 8
Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

How Amazon Trained Its Investors to Behave

Harvard Business Review

Well, he's a hedge fund veteran who has always taken a skeptical view of Wall Street, treating it more as a loopy rich uncle than the efficient information processor of standard finance theory. With Amazon, though, nobody emphasizes EPS. But he's also always been ready to shift gears when the mood turns stingy.

article thumbnail

You Can't Impress Stock Analysts.and Shouldn't Try

Harvard Business Review

Nobody writes a paean to the search for 9 percent EPS growth. If you believe the best-selling business books from the last 25 years, companies are "In Search of Excellence" or trying to go from "Good to Great." Moreover, pure growth targets are even wackier right now.

GAAP 9
article thumbnail

Firms Are Wasting Millions Recruiting on Only a Few Campuses

Harvard Business Review

These organizations, also known as elite professional service (EPS) firms, have some of the most well-developed and longstanding on-campus programs. In the EPS world, on-campus “school lists” have two tiers, based largely on prestige. ” How It Works — and How “Regular” Applicants Get Ignored.

EPS 8
article thumbnail

What Apple Should Do with Its Massive Piles of Money

Harvard Business Review

I know that finance professors at business schools throughout the nation teach MBAs and executives that, for the sake of economic efficiency, a company should “maximize shareholder value.” I disagree with this priority.

EPS 11
article thumbnail

The 6 Ways Business Leaders Talk About Sustainability

Harvard Business Review

Firms like these have created tools like Environmental Profit & Loss (EP&L) statements and Social Return on Investment (SROI) to capture a more complete picture of their businesses. Whether in politics, finance, or business, there is growing concern that many leaders have lost their moral compass. The Moral Frame.

Morale 8