My take on short-termism

Recently, the Malawi University of Business and Applied Sciences (Mubas) School of Business and Economic Sciences in Blantyre hosted a two-day research dissemination conference on harnessing sustainable prosperity. The conference brought together business leaders, academics, researchers, students, policymakers and ordinary citizens to reflect on Malawi’s economic trajectory and the role of industry in sustainable growth. The keynote address and panel discussions tackled a persistent yet damaging challenge facing the country’s business sector—short-termism, the excessive focus by corporate, financial and political decision-makers on immediate or short-run outcomes.

The quick gains include quarterly earnings or annual performance targets that come at the expense of long-term value creation, sustainability and strategic investment. This phenomenon is often driven by pressure to meet market expectations and maintain short-term profitability. This undermines investment in research, sustainable development, long-term competitiveness, environmental protection and social risks.

While quick gains may appear rational within highly competitive markets, its cumulative effects on the economy are deeply damaging to the economy. Sustainable business operations cannot be divorced from national development priorities. For meaningful and inclusive economic growth in Malawi, long term business strategies must align with the country’s long-term development framework.

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The Malawi 2063 vision articulates a pathway towards an inclusively wealthy and self-reliant nation, with medium and short term implementation plans embedded within it. However, implementation by the public sector has been significantly underwhelming. In July 2024, the National Planning Commission (NPC) reported that progress on the first 10-year Malawi 2063 Implementation Plan (MIP-1) stood at 43 percent.

This underperformance reflects deeper structural challenges in the economy. Malawi’s economy has been severely constrained by multiple shocks and systemic weaknesses. These include recurrent climate-related disasters, a high public debt burden, misalignment between national budgets and MIP-1 priorities and a slow implementation of catalytic interventions by the public sector.

Currently, projections indicate that MIP-1 could lag by as much as 15 years unless the economy grows at an average rate of 10.6 percent annually by 2030. This target is highly ambitious given the 2025/26 growth estimates of two to 3.8 percent. The private sector, particularly the financial sector, has compounded the problem by chasing short-term profits instead of acting as an engine of long-term growth.

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