What is the difference between profit maximization and maximization of shareholder wealth?

Answer #1

Generally speaking, a company’s shareholders should be those getting enriched the most by the actions of the officers and employees.

However, it’s pretty easy to see (Yahoo anyone) how over the last four years, their executives have destroyed shareholder wealth, while still posting hefty profits as a company…where did the money go? Look to the executives.

You got part of this here :) http://www.funadvice.com/q/phrase_goal_maximization_shareholder_wealth

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What is the difference between profit maximization and maximization of shareholder wealth?

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