Do Covid-19 subsidies threaten shareholder value?

New era of stakeholder capitalism

As more companies tap government stimulus funds, more questions are being asked about how the use of taxpayer money may affect shareholders.

To answer these questions, investors must assess how corporate behaviour and stakeholder engagement will shape a company's long-term outlook. Government stimulus is an essential ingredient to combat the recessionary drag of the pandemic. For many companies, stimulus funds provide a cash lifeline that can make the difference between survival and extinction in today's tough environment.   Complex questions for investors  Yet the provision of public grants or loans also creates questions for investors. Should companies be allowed to draw on taxpayer funds if they didn't manage their ca...