Jul 01, 2015
From the Audit Committee Institute
“There’s a real cultural shift happening,” noted one of the 1,200 directors and executives attending KPMG’s Spring Roundtable Series, Capital Allocation and the Board. “Companies are becoming more transparent with investors on capital allocation and strategy.”
“Activism is pushing capital allocation out of the back office, through the C-suite, and into the boardroom,” said another director. “But some companies and boards have overemphasized placating a noisy class of investors.”
As highlighted at our roundtable series, the capital allocation discussion is more than one of how best to use cash. It’s a fundamental discussion at the intersection of running the business and delivering shareholder value: Companies achieve success not only be generating cash and achieving business results; they also need to allocate capital in a way that is most beneficial to shareholders and to building long-term value.