‘Dangerous’ obsession

Press, 9 July 1986, Page 34

‘Dangerous’ obsession

PA Wellington The commercial sector’s present obsession with high share prices and short-term profitability was undesirable and dangerous, according to the president of the New Zealand Society of Accountants, Mr Gary Lloydd. Mr Lloydd Is also managing director of McDonald? Systems of New Zealand. Speaking to the Auckland Rotary Club, he said he was concerned because more and more resources, including the cream of New Zealand’s youth, were being thrown into financial activities remote from the production of goods and services. These activities benefited the few at the expense of social productivity. Mr Lloydd said that the companies who used the take-over process as middlemen, considered that financial considerations and

short-term profit reporting were more important than the long-term benefits of increasing production. But countries such as the Japan, and new Korea, had raced ahead of the rest of the world through their productivity. “I believe that too many of our resources, ®ur funds, and the energies of our bright young people are being turned towards the transfer of value, rather than the creation of new wealth,” he said. “We hear a lot about the problems of the rural sector, but not enough about the ability to diversify and increase production of a new and wider range of agricultural and horticultural products.”

He suggested that this creativity needed to be carried over the whole of the commercial sector.