Research Insight · From Sections 11 & 14 of the SGaaS White Paper
The Wealth Concentration
Mauboussin and Callahan (2026) analysed nearly 24,000 US public companies across a century. The result is a distribution most boards do not want to see: seventy percent failed to justify their IPO price. Less than one percent created the bulk of the wealth. The shape of that asymmetry is what governance is for.
Companies analysed
0
US public companies, 1926–2025
Failed to justify IPO
0%
lifetime earnings below the IPO price they were sold at
Created 75%+ of all wealth
0%
approximately 168 companies out of 24,000
Aggregate shareholder wealth
$0T
total US public company value creation, 1926–2025
The 0.7% · ~168 companies
The companies that account for three-quarters of a century of wealth creation
A mere 0.7% of all listed US companies created more than 75% of the $91 trillion in aggregate shareholder wealth produced over the 1926–2025 window. Around 168 firms account for roughly $68 trillion of value, an average of ~$406 billion each.
Why the 0.7% is the 0.7%
The 0.7% is not a sampling oddity. It is the population of firms that sustained a long competitive advantage period.
Mauboussin and Callahan’s evidence is direct. Companies that sustained top-quintile ROIC for ten years or more did so primarily through differentiation, not cost leadership; their NOPAT margins ran at 2.8× the universe median. Default trajectory is value erosion: ROIC regresses toward the sector mean at an average annual fade rate of approximately one-fifth. The question is how long a company can resist that gravitational pull. Competitive advantage period (CAP) is the measure of that resistance, and terminal value — which represents 70%+ of firm value in standard DCF — is a direct function of it. Governance challenge is one of the mechanisms that determines the answer, because the assumptions that accelerate the fade (unchallenged strategy, unexamined competitive position, unquestioned capital allocation) are precisely the assumptions an adversarial function is designed to surface.
What this means for the board
The wealth distribution is not random. It is the cumulative outcome of capital-allocation decisions made under variable governance quality, year after year.
01
Default is value erosion
For 99.3% of public companies, the trajectory is regression to the sector mean. Governance challenge is what resists that gravitational pull one capital-allocation decision at a time.
02
CAP is the dominant variable
Terminal value — 70%+ of firm value in standard DCF — is a direct function of CAP duration. Every additional year of CAP compounds at the spread the firm sustains.
03
Differentiation, not cost leadership
Top-quintile firms achieved their position through differentiation, with NOPAT margins 2.8× the universe median. Strategic clarity matters more than operational efficiency at the long horizon.
04
SGaaS targets the fade rate
Adversarial governance challenge interrogates the assumptions that accelerate ROIC fade. The economic argument for Embedded and Pre-Exit tiers is measured against CAP-extension value, not loss avoidance.
The Economic Logic
The default trajectory for the public company is value erosion. The 0.7% that resists that trajectory does so through sustained competitive advantage, and competitive advantage is sustained through capital-allocation discipline and strategic falsification. Governance is the architecture inside which both happen — or do not.
From Strategic Governance as a Service, Sections 11 & 14 — Marentis Labs, 2026.
From the SGaaS White Paper
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The interactive above is one of seven drawn from the 90-page Strategic Governance as a Service research paper. Download the full paper or schedule a confidential conversation.