Allison Schrager, Columnist

Shareholder Capitalism Is Back

After spending too many years trying to signal their virtue, companies are focusing once again on returns to investors.

March 10, 2025 at 11:30 AM UTC

Allison Schrager is a Bloomberg Opinion columnist covering economics. A senior fellow at the Manhattan Institute, she is author of “An Economist Walks Into a Brothel: And Other Unexpected Places to Understand Risk.”

Shareholders engaging in capitalism. — Shareholders engaging in capitalism.
Photographer: Andrew Beatty/AFP via Getty Images

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The virtue economy, the only bubble I have ever called, has now completely burst. Many companies are cutting their DEI programs, flows into ESG funds in the US have fallen, and companies are being more quiet about politics.

The disappearance of the virtue-industrial complex does not come without a cost, on a human as well as financial level. At the same time, there is a clear winner — the concept of shareholder primacy. The idea, popularized by Nobel laureate Milton Friedman in 1970, is that corporate executives and boards have a single goal: to maximize return to their shareholders.