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Essay / Research Paper Abstract
This 10 page paper considers what conflicts are created by the imposition of environmental, pollution, hiring, and other regulations or legislation on businesses on the management objective of the maximization of shareholder wealth. The paper discusses the potential conflict, how this has been dealt with by companies including the use of outsourcing and off shoring and discusses whether or not the objective of shareholder wealth maximization in a regulated environment is a realistic objective. The bibliography cites 12 sources.
Page Count:
10 pages (~225 words per page)
File: TS14_TEshareleg.rtf
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Unformatted sample text from the term paper:
expected of a business. The imposition of environmental, pollution, recruitment and employee treatment regulations or legislation on business by government may be seen as constraining thee management objective of the
maximization of shareholder wealth. The constraints that are placed on business cannot fail to have an impact on business, but does this mean that it is an unrealistic outcomes are
expected from businesses when they have to work with these conflicting objectives. The shareholder is generally seen as the primary stakeholder in
any business, it is this group of stakeholders that are considered when annual reports are prepared. When looking at shareholder maximization the school of shareholder wealth maximization should be considered.
The school of shareholder wealth maximization states that it is the shareholder who is the principle concern of the organization (Dobson, 1999).
A proponent of this school of thought was Milton Freidman, a highly regarded economist, capitalist and Nobel Prize winner. Friedman had a simple view on the responsibility of a company
(Chryssides et al, 1999). Friedmans argument was that business have only one responsibility and that is the responsibility to their shareholders or owners; the increasing of their profits and return
(Chryssides et al, 1999). Milton Friedman was a capitalist and an unwavering supporter of Laissez faire capitalism, that is freedom from intervention of any sort save that of which
was needed to ensure that freedom of the market continued (Chryssides et al, 1999). The effect of this statement is obvious;
it denies that there is any further responsibility save that of the owners of the business (Chryssides et al, 1999, (Dobson, 1999). This argument is not quite as simple as
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