This article originally appeared on Finweek.

In the current tepid economy, shareholders are pressuring executives to grow their businesses, and this pressure is unrelenting.

However, organic growth alone is unlikely to deliver the high levels of returns investors expect.

As companies pursue profitable growth, nothing beats a balanced strategy that includes inorganic growth.

Yet, many companies remain wary of mergers and acquisitions (M&A), preferring to hold on to their cash or return it to their shareholders as dividends or share buybacks.

While this may help short-term earnings per share, it does very little to deliver above-average total shareholder returns (TSR), the ultimate measure of a company’s financial performance. (TSR is defined as stock price changes assuming reinvestment of cash dividends.)

Our analysis shows that growing operating earnings is the only way to spur long-term TSR. And the one thing that spurs operating earnings growth: systematic reinvestment into the business.

M&A happens to be a particularly attractive option.

Our analysis of M&A activity over a decade indicated that those companies that were active in M&A consistently outperformed those that stayed away from deals.

Bain analysis of deals spanning a 10-year period found that as a group, companies that engaged in any M&A activity averaged 4.8% total shareholder return compared with 3.3% for those that were inactive.

In short, M&A is an essential part of successful corporate strategy for profitable growth. In particular, we have learnt that the more a company makes M&A a part of its playbook, the more successful its deals become.

So how do you ensure you and your company are successful at M&A?

Read the full article at Finweek.

Andrei Vorobyov is a Bain & Company partner based in Johannesburg where he leads Africa’s Private Equity and M&A Practices.