> And from an investor perspective, as a group they have underperformed the S&P 500.

This should be kind of obvious -- if they are avoiding doing awful things in the name of money, then they are leaving something on the table. You can't have your cake and eat it too. This is why the real solution is some kind of governance/regulation, because otherwise the market incentivizes being awful.

As a note, Wells Fargo is underperforming for doing terrible things and getting caught multiple times.

Actually you can have your cake and eat it too. Market incentives aren't awful in most cases. The worst incentives are actually stock standard owner/manager misalignment (or "principal agent problem") whereby the agents are short term oriented because they are comped that way.

well, eric's book tries to make the point that these good companies DO overperform the market. after reading the book this past week, im not convinced. feels like heavy selection bias.

I want to appreciate you for this comment, even though I disagree with it, because this is a really articulate version of the conventional wisdom that I think all of us have imbibed since before we could talk.

I don't understand your comment. Companies like Netflix, Old Dominion Freight Line, Nvidia, Comfort Systems USA, and Intuitive Surgical have all significantly outperformed the S&P 500. What "awful" things have they done in the name of money?