The Great Myth of the Maverick CEO: Are Capitalists Innovators or Just Accumulators?

In the grand theater of modern business, we are often sold a compelling narrative. It’s the story of the maverick entrepreneur, the visionary CEO whose unique “flair” and daring risks forge new industries from sheer force of will. We picture Steve Jobs in a black turtleneck unveiling the iPhone, or Elon Musk launching rockets into the cosmos. These figures are lionized as the singular engines of progress, the titans whose genius propels our economy forward. But what if this story, as captivating as it is, obscures a more mechanical and far less glamorous truth?

In a pointed letter to the Financial Times, Professor Des Freedman of Goldsmiths, University of London, challenges this very notion. He argues that we should “forget entrepreneurial flair” and instead recognize modern capitalists for what they primarily are: accumulators. This isn’t a story of swashbuckling innovation, but one of systematic wealth consolidation. This perspective reframes the entire conversation about our modern economy, forcing us to look past the charismatic personas on the world stage and examine the machinery operating behind the curtain.

This post delves into that machinery. We will deconstruct the myth of the lone genius, explore the powerful mechanisms of capital accumulation that define today’s corporate landscape, and analyze the profound implications for the future of finance, investing, and the broader economy.

The “Entrepreneurial Flair” Illusion: Deconstructing the Myth

The celebration of the individual CEO is a cornerstone of business journalism and corporate PR. It’s a simple, powerful story that is easy to sell. It taps into the age-old “great man theory” of history, which posits that progress is driven by the actions of a few extraordinary individuals. In business, this translates into attributing a company’s success—or failure—almost entirely to its leader. While strong leadership is undeniably important, this narrative conveniently ignores the vast, complex ecosystem of people and factors that truly drive success.

The reality is that innovation is a collective endeavor. It is born from the tireless work of thousands of engineers, designers, researchers, marketers, and factory workers. It is often built upon a foundation of publicly funded research and infrastructure. For instance, the core technologies that make the smartphone possible—the internet, GPS, touch-screen displays, and cellular communication—were all products of government and military research programs, a fact detailed extensively by economists like Mariana Mazzucato in her book, The Entrepreneurial State. The visionary CEO is often the one who masterfully packages and markets these innovations, but they are rarely their sole creator.

By focusing on “flair,” we misattribute the source of value creation. This misattribution has significant consequences, justifying staggering levels of executive compensation and creating a culture that prioritizes the perceived genius of one person over the collective well-being and contribution of the entire workforce.

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The Real Game: Unpacking the Mechanics of Accumulation

If the primary function of modern capitalism isn’t necessarily fostering entrepreneurial genius, what is it? Professor Freedman’s term, “accumulation,” points to a system designed to concentrate existing wealth and market power. This process operates through several powerful, interconnected financial mechanisms that have come to dominate corporate strategy.

1. The Doctrine of Shareholder Value Maximization

For much of the 20th century, corporations were seen as having a responsibility to a range of stakeholders: employees, customers, and the community, as well as shareholders. However, beginning in the 1980s, the doctrine of “shareholder value maximization”—championed by economist Milton Friedman—took hold. This ideology argues that a corporation’s sole social responsibility is to increase its profits and, therefore, its stock price for shareholders. This seismic shift in corporate governance reoriented the entire purpose of a public company from long-term value creation to short-term financial performance. The stock market became the ultimate arbiter of success, and every decision was judged by its immediate impact on the share price.

2. Stock Buybacks: Engineering Value Instead of Creating It

One of the most direct tools of accumulation is the stock buyback. When a company uses its cash to repurchase its own shares from the open market, it reduces the number of outstanding shares. This artificially inflates earnings per share (EPS), a key metric for investors, which often boosts the stock price. While proponents argue this is an efficient way to return capital to shareholders, critics see it as a form of financial engineering that comes at a steep cost.

The numbers are staggering. In 2023, S&P 500 companies spent over $795 billion on stock buybacks. This is money that could have been invested in research and development, used to increase employee wages, lower prices for customers, or saved for future economic downturns. Instead, it is used to directly enrich shareholders and executives, whose compensation is often tied to stock performance.

Let’s look at a comparison of how some major corporations have allocated capital:

Note: Data is approximate and compiled from public financial statements for illustrative purposes.

3. Mergers & Acquisitions (M&A): Buying a Monopoly

Another powerful tool of accumulation is growth through acquisition. Instead of out-competing rivals through superior innovation, large corporations can simply buy them. This strategy serves two purposes: it eliminates a competitor and absorbs their market share, technology, and talent. While some M&A activity can be strategic and beneficial, a wave of consolidation across industries—from tech and media to pharmaceuticals and agriculture—has led to reduced competition, higher prices for consumers, and less pressure to innovate.

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Fintech: The High-Speed Engine of Accumulation

The principles of accumulation are not new, but the rise of financial technology, or `fintech`, has put them into overdrive. Modern `trading` algorithms can execute millions of transactions per second, capitalizing on infinitesimal price discrepancies. This high-frequency trading has little to do with assessing the fundamental value of a company and everything to do with short-term speculative gain.

The `fintech` revolution has also democratized access to the `stock market`, but it has simultaneously created more complex and opaque financial instruments. The world of `blockchain` and cryptocurrencies, once hailed as a decentralized alternative to traditional `banking`, has largely become a new frontier for high-risk speculation and rapid accumulation for a new class of digital capitalists. This hyper-financialization of the `economy` pulls talent and capital away from productive enterprise and channels it into a zero-sum game of financial maneuvering.

Rediscovering the True Sources of Value

If the system is geared towards accumulation, where does real, breakthrough innovation come from? As mentioned earlier, it’s a far more distributed and collaborative process than the “maverick CEO” myth suggests.

True value creation is rooted in:

• Collective Human Capital: The combined skills, creativity, and labor of a company’s entire workforce.
• Public-Sector Investment: Government-funded basic research that lays the scientific groundwork for future commercial applications.
• Long-Term Vision: A willingness to invest in ambitious, uncertain R&D projects that may not pay off for years or even decades.

A system obsessed with short-term accumulation actively undermines these very sources of value. It squeezes labor costs, benefits from public research without adequately reinvesting through taxes, and punishes companies that sacrifice short-term profits for long-term bets. The gap between the compensation of top executives and their median workers is a stark illustration of this disconnect. The Economic Policy Institute reports that in 2022, CEO pay at top U.S. firms was 344 times that of the typical worker, a dramatic increase from the 21-to-1 ratio seen in 1965.

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Conclusion: Beyond Flair and Towards a More Productive Future

Professor Freedman’s assertion that capitalists are primarily accumulators is not just an academic provocation; it is a fundamental re-evaluation of how our modern economy operates. The romantic notion of “entrepreneurial flair” serves as a convenient and powerful myth that masks a system of financial engineering, market consolidation, and wealth extraction.

For investors and finance professionals, this perspective is crucial. It encourages a deeper look beyond surface-level narratives to analyze how a company truly allocates its capital. Is it investing in its future, or is it simply engineering its stock price? For business leaders, it poses a challenge: to lead for genuine, sustainable value creation or to manage for short-term accumulation. And for policymakers, it highlights the urgent need to reform the rules of the corporate and financial world to incentivize long-term investment, fair competition, and a more equitable distribution of the wealth that we collectively create.

Ultimately, shifting our focus from flair to function—from the myth of the individual to the mechanics of the system—is the first step toward building an economy that rewards genuine innovation over mere accumulation.