Learning What Works

My current research focuses on FDA reform, corporate governance, and accounting/valuation issues.

Since retiring as a Managing Director at Credit Suisse in 2003, I have written a dozen articles about a Dual Track system to achieve freedom of choice for late-stage experimental drugs. In May 2007 the Heartland Institute published a booklet, More Choices, Better Health: Free to Choose Experimental Drugs, that summarized this work

There are formidable political obstacles to passing legislation that fundamentally breaks the FDA’s monopoly on access to drugs. But voters may become energized to support politicians who believe that individuals and families ought to be free to improve or save a life, even if doing so involves more risk than with FDA-approved drugs. The current FDA regulatory regime is profoundly at odds with this simple and compelling idea, and that cries out for structural change.

After receiving a BS in mechanical engineering, working as an engineer, and spending time in the Army during the Vietnam War, I then shifted gears and earned an MBA at the University of California, Berkeley. My first job in investments was with a major Chicago Bank. In 1970 I co-founded Callard, Madden & Associates, and spent the next 14 years developing the CFROI (cash-flow-return-on-investment) valuation model widely used by large money management firms today. Our firm consulted with portfolio managers and corporate managers so they better understood the connections among corporate economic performance, stock prices, and shareholder returns. I then spent the next eight years managing portfolios for Harbor Capital Advisors and continued my empirical research on the CFROI framework.

I have long been interested in the deeper issues of inquiry and reliable knowledge. My first article on this subject was A Transactional Approach to Economic Research, which appeared as a 1991 Journal of Socio-Economics article. (For a quick overview see the “Background” section on this website.)

After Harbor Capital Advisors, I joined HOLT Value Associates in the early 1990s, a firm created to commercialize the CFROI framework worldwide. I began writing corporate finance articles which were published in the Journal of Applied Corporate Finance, Journal of Portfolio Management, Wall Street Journal, Journal of Investing, and other business publications. In 1999, my book, CFROI Valuation: A Total System Approach to Valuing the Firm, was published by Butterworth-Heinemann. Credit Suisse acquired HOLT in 2002.

My 2005 monograph, Maximizing Shareholder Value And The Greater Good, explains macroeconomic wealth creation in terms of the microeconomics of pursuing maximization of shareholder value, emphasizing the long-term mutual interests of shareholders, employees, and customers.