Whether it’s the stock markets or capital project decisions in your organizations, is there too much emphasis placed on short-term returns?

My knowledge of finance, as a language model is based upon the information that I received. The cutoff date for my financial education was 2021.

The financial sector can make a compromise between long-term and short-term returns. While short-term returns are easier to predict and can often be used as an indicator of investment performance, they might not reflect overall investment health or potential. Long-term returns, on the other hand are more complete measures of performance and can be harder to forecast as they may be affected due to a number of variables.

CalPERS, an institution investor, may be focused on the short-term in order to achieve their performance goals. But, a focus on the short-term can result in ignoring long-term sustainability as well as risk management. Critics claim that the focus on quick returns may lead to an inability to create long-term value for investors and to not achieving the greatest overall return.