The reply to the above question can be both ambivalent and multi-dimensional. If the pursuit of shareholder value is carried out blindly while shutting oneself completely from the external environment factors that can both impinge upon it and rely upon it, then I must confess that there could be a resultant conflict between such a pursuit and sustainable economic growth.
On the other hand, if the pursuit of shareholder value deliberately sets out to marry the achievement of such an objective with the attainment of key socio-economic and environmental goals, then I believe that it becomes both possible and likely that sustainable economic growth can and will be achieved.
It all boils down to the attitude and perception, strategy and approach adopted by those pursuing shareholder value.
There was a time when sustainable growth and development were perceived as constraints on growth and free market economic principles. Within this narrow perspective, the answer to the core question cannot but be in the negative.
On the other hand, if those pursuing shareholder value realise that sustainable economic growth and development can go hand in hand with both innovation and wealth creation, then the prospect of such sustainable growth can actually serve as a stimulus to promote shareholder value actively, towards the attainment of an enhanced productivity performance as well as a tangible improvement in one's standard of living and quality of life.
Shareholder value is not an abstract objective that can be achieved in isolation. On the contrary, it is a process whereby change is not only made to work but also as a result of which products and processes can be made to embrace the new realities by offering solutions to key problems, and new business innovations to match arising opportunities.
When a corporate structure deliberately sets out to maximise economic performance and reap the benefits of economic growth, albeit within its specific area of activity, the achievement of two major objectives not only becomes attainable but also end up working out at being complementary to one another.
A company or corporation seeking to boost its shareholder value can actually deliberately set out at the outset to make sustainable development happen through the innovative aspect of its products and processes.
When a company's corporate strategy spurs it on to seek FDI - foreign direct investment - in any part of the globe, the determining factors behind the outreach of its global strategy could actually be the pursuit of minimised risks, the prospects for future corporate growth as well as the creation of an environment where tangible benefits can be mutually attained both by the company itself as well as by the economy that will be hosting its location.
Sustainable economic growth must be the ultimate objective of any strategic plan, especially since it often entails the ingredients that can help it serve as both a value driver and a revenue generator.
Sustainable economic growth in itself is a vehicle for the creation of more value, while minimising the cost of doing so as well as any negative impact, which such a process could generate.
Increasing shareholder value and promoting sustainable economic growth are goals that can live side by side the moment we realise that they are both necessary and can also prove to be inevitable if approached positively with the prospect of an inherent linkage firmly in mind from the very outset.
Bearing in mind that sustainable development and economic growth can in itself prove to be a value-enhancing proposition, then those pursuing increased shareholder value should have ever more reason to seek innovation, enhanced productivity as well as a stepped up competitive edge.
The prospect of matching economic growth with increased shareholder value can actually develop into the realisation that what we have at stake is nothing but a sense of shared values and objectives.
New technologies do not only render themselves more and more accessible to industry - but if their benefits are maximised they can also broaden themselves by serving society in general and the community in particular.
When a consumer feels empowered that he needs to participate and benefit from certain new solutions offered, he is simultaneously serving as a catalyst for change that increases shareholder value while at the same time helping an economy grow by benefiting directly from its positive spin-offs.
By aligning increased shareholder value with enhanced economic growth we could actually be introducing a strong element of corporate sustainability, whereby shareholder value can be created to economic advantage by embracing new opportunities and managing key economic, social, environmental and ecological developments.
To achieve these aims, companies need to look beyond the mere attainment or enhancement of shareholder value in isolation.
On the contrary they must ensure that their corporate strategies offer the widest vision possible, thus enabling themselves to maximise opportunities and at the same time turning external threats into actual benefits.
The need for a convergence of shareholder value with sustainability considerations is growing worldwide, the more companies come to realise that stakeholder benefits extend considerably beyond mere shareholder objectives.
When an economy grows it normally leads to value creation. The development of such a scenario can actually serve as a magnet for the attraction of new opportunities for corporate finance.
Shareholder value is created by the judicious application of human and material resources. So is economic growth. The globalisation process should provide the right stimulus to ensure that knowledge and power are both used productively to the benefit of such a productive partnership.
Those seeking to enhance shareholder value must realise that companies and corporations are not entities operating in a vacuum. On the contrary, they need to work alongside the key players and chief actors of economic growth and sustainable development - be they government itself, civil society, private industry and, in most instances, a number of NGOs too.
When a company takes certain strategic decisions aimed at enhancing its shareholder value, not only does it simultaneously seek to improve the quality of life of its employees as well as their families and the communities they live in, but given the size of certain corporations they can actually affect the demographics of a particular area, employment trends and orientation, providing opportunities that seek to increase profits through regeneration and investment.
This way companies will be impacting positively on the communities in which they operate, having a telling effect on the economic growth process within the areas where they happen to be located.
Corporations can best attain these goals and objectives if they deliberately set out to reach all their stakeholders - be they the media, investors, Government, customers, consumer groups, industry associations or the regulators themselves.
While on one hand, to continue to be profitable an organisation needs to anticipate and respond to customer needs, on the other it must realise that improved customer satisfaction will not only lead to an enhanced quality of life, but also, somehow, impinge on the rate or state of economic development and growth in the area.
Large corporations must constantly bear in mind that they have the potential to impact on others. For this reason they must aim to ensure that their economic impact on others is positive.
With the ever-changing marketplace many corporations have come to understand that to help profits grow as well as to sustain them they need to be fast, flexible and willing to respond to change. Such an approach can impact directly on both shareholder value and economic growth in general.
In this day and age such objectives cannot be truly achieved unless companies put into practice the sound business principles of transparency, values and ethics that corporate governance brings with it. This must also be reflected in the day-to-day management of the companies concerned.
Where companies can and do impact on the environment in which they operate, the introduction of environmental accounting programmes become imperative, since they help ensure that the links between financial and environmental performance become more and more visible.
Corporate governance should not be limited to listed companies only. Basic governance structures should also be evident in the way family- owned businesses operate and are run. The stronger their top-level responsibility towards the achievement of these aims the stronger will be the sign of commitment on their part.
It is imperative that corporations seeking to increase their shareholder value should have clear communication mechanisms inclusive of formal complaints processes, while showing a readiness to demonstrate leadership with external stakeholders to promote sustainable development.
When corporations support community development and its capacity to generate wealth, they will be fostering economic growth while addressing the companies' commitment to the gaining of economic benefits within the community where the companies are operating, as well as contributing to the economy itself.
A corporation's business drivers do not only influence business performance through the generation of revenue and the containment of costs but also through their impact on the motivation of their human resources, particularly since the attainment of a high ground in the latter instances could actually decrease costs through increased productivity.
In today's society corporations do not only seek to improve on their existing products but often introduce new products, which could result from sustainable development-based initiatives. By innovatively filling a social, economic or environmental need, companies could actually end up enhancing revenue growth and market access. The same applies to cost savings and productivity.
While increased shareholder value is likely to result in an increased ability to raise capital through debt and equity, improved access to long-term debt can also materialise due to meeting certain environmental and social requirements.
For this reason stepped up economic growth can promote increased shareholder value as a consequence of such a development.
Pro-active consideration of environmental and social issues can reduce or even eliminate business disruption while on the other hand strong compliance can reduce vulnerability to changing regulations.
One feels compelled to give priority attention to the human capital element because human resources are important in determining companies' ability to innovate and compete.
Ultimately all these factors end up reflecting the public perception of a company, its products and brands. Increased shareholder value cannot be seen as a mere short-term objective.
If one really has corporate sustainability in mind, shareholder value must be created on a long-term basis, enabling the corporate entities concerned to embrace opportunities and professionally manage the risks deriving from the economic, environmental and social developments resulting from the areas where they operate.
Basically, it all boils down to companies gearing their strategies to harness their markets' potential for sustainability while reducing and even avoiding in some instances sustainability costs and risks.
Companies seeking to achieve or maintain global competitiveness and brand reputation cannot afford to overlook such considerations, particularly as far as setting the highest standards of corporate governance and stakeholder engagement are concerned.
These are the measures that have promoted the move to so-called 'triple bottom line' reporting about the economic, social and environmental aspects of a corporation's management.
In doing so companies will not only be able to meet current expectations but also to meet challenges that involve new risks and uncertainties.
The generation of shareholder value through sustainable approaches means that "in this day and age corporations require strategies that are broad in scope, long term in vision and responsive to the inevitability of change".
A company does not only need to be or become profitable. If it really endeavours to succeed it must ensure that it remains profitable in the long term.
By building stakeholder support for their growth plans, corporations can often meet the growing consumer demand for their products with a lower environmental impact.
In doing so companies will also show that they can think beyond the financial goals of their strategies by also thinking about the socio-economic and environmental aspirations of their stakeholders.
This they can do by ensuring that they share their plans while responding to public input. In increasing efficiency through such channels and methods, companies will be strengthening their endeavour to avoid seeing their shareholder value eroded.
(To be concluded)
Leo Brincat is the Shadow Minister of Foreign Affairs and IT and a former Minister of Commerce and Finance.