The New York Times notes that several companies, including Boeing and YUM! Brands, poured years of cash piles into stock buybacks and dividends:

These companies had been highly profitable in recent years, yet they were seeking help from the federal government. Where had all their money gone? Like much of corporate America, the restaurant chains had spent a large chunk on buying back their own stock, a practice aimed at bolstering its price. Some were even more vulnerable to the economic shock because they had previously increased their borrowing—including to fund buybacks or pay dividends—and strained their credit in the process.

Still, the crisis has exposed the potential failings of a strategy embraced by many big companies: aligning their priorities with the interests of shareholders, many of whom are narrowly focused on the performance of a company’s shares. Shareholders, wanting stock prices to go higher, pushed management to use up cash on buybacks and dividends. And senior executives, paid largely in stock and on the basis of how the stock performed, were happy to oblige. The result was that companies often didn’t have much spare cash, leaving them even more exposed to economic downturns.