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I assume one could say the spare money could be spent on growing the company, making more money in the longer run.

(disclaimer: I have no idea what I'm talking about)




Right.

Good corporate governance points toward the maximization of long-term shareholder value, as measured by the present value of payments to shareholders (dividends, buybacks, etc.) http://en.wikipedia.org/wiki/Net_present_value

Silicon Valley has a somewhat bizarre culture of viewing dividend payments as "defeat", as in, "We can't find anything better to do with the cash because we aren't innovative, so we're giving it back to our investors". This is where the (strange) logic of profit=evil comes from in these conversations.




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