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He asks managers to judge every action by how it would look on the front page of a local newspaper, written by a smart but unfriendly reporter.

The original source of his thoughts on the "institutional imperative" and ethics. To provide more tailored advice for your report: He asks managers to judge every action by

Rationality is most critical when deciding what to do with company earnings. He expects managers to reinvest money only if it can generate a return higher than the cost of capital; otherwise, it should be returned to shareholders. He expects managers to reinvest money only if

He warns against the tendency of managers to mindlessly copy their peers' behaviors—even irrational ones—simply because "everyone else is doing it". 📖 Recommended Resources A manager must remain rational when others are

Why Rationality Wilts In The Face Of The Institutional Imperative

He argues that temperament is more important than IQ. A manager must remain rational when others are panicking or being greedy.