Panera CEO knocks Wall Street culture that celebrates activists

For Ron Shaich, the chief executive officer of Panera Bread Co., getting acquired by closely held JAB Holding Co. meant no longer having to worry about activist investors.

Shaich, who in April sold the Sunset Hills-based cafe chain he founded for $7.2 billion, says that a Wall Street culture relentlessly focused on short-term profit and quarterly metrics is stifling innovation. And he adds it’s only getting worse as activist investors increasingly target the restaurant industry.

“The very nature of what activists want is to move the shares tomorrow — it’s not helping,” he said in an interview. “These guys show up, they’re renting the stock and they tell you what to do — it’s not a positive way to have dialogue.”

Now that he’s part of a private company, Shaich said he can innovate faster and be more aggressive to attract Panera’s target market of health-conscious diners. Panera has posted positive same-store sales each of the past 18 years, including during the financial crisis. From 2010 through its last day of trading in July, the company’s stock gained more than fourfold, outperforming the S&P 500 during that time.

Shaich faced activist pressure during his tenure running Panera: Wall Street questioned a digital transformation of the chain that didn’t go smoothly at first. Now, with more than 25 percent of the company’s sales coming through digital kiosks and its website and mobile app, Shaich feels vindicated.

Read more: Bloomberg


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