Maximizing Shareholder Values Case Study

Maximizing Shareholder Value is the sole responsibility of Corporate Management.
Discuss the pros and cons of this statement with the help of information from multiple sources. What is your opinion?
The pros of having Corporate Management as the sole responsibility of maximizing shareholder values is the ability to have more control on how stuff are ran. The main goal of the shareholders values are easily obtain as only limited amount of people are dealing with this responsibility. With a smaller group allows for less complication and disagreements. Thus allows for greater returns in the shareholders pocket which equals to maximizing wealth. If the shareholder get more profit and wealth this would lead to keeping corporate management with …show more content…
When it comes to making profit this comes from consumer buying products. If every consumer in the world stops buying the product the values and profit of shareholders would be gone. I feel that consumer should have a say in maximizing shareholder values as corporate management will do what best to keep their jobs. Their interest is for keeping their jobs which requires maximizing profit. If we look at corporation many are more willing to pay to fight lawsuits or continue littering than to stop and change. Why? Because it’s all about maximizing profit, if I make more money than the fine would be what stopping me from polluting the earth. Shareholders main goals are for values and profit which the corporate management must meet these responsibilities which allows for a corporate system, people have little to no say even though we are the consumer and live in the same planet as them. If corporate management had only one responsibility which was to bring maximum values to shareholder this would lead to a huge corruption in power. In society today there is a corruption as corporation are able to influence politicians by donation for their political parties which lead to legislation in favor of them, thus making it more corrupted than …show more content…
A shareholder owns part of a company through stocks which lead to dividend and profit, if they were an agent this allows for control on what they want done directly. The shareholders have a say in part of the corporation they own. Shareholder may also see the company from a different standpoint so if management is agent of shareholders they may see a view that could be hinder from management standpoint. Another pro would allow shareholder leverage on increasing shareholder stake in a company if a merger or takeover