Corporate Goal of Maximizing Shareholder Value Essay

Corporate Goal of Maximizing Shareholder Value - Essay Example Enhancing shareholder value cannot be stretched beyond the limits that start breaching the fundamental requirements of corporate governance. Ireland (1996. pp289) established an empirical generalization that the legal existence of the company and the shareholders is entirely separate. Although acts like Sarbanes Oxley in United States have made the leadership of the organization (CEO or CFO!!) legally responsible for the accuracy in accounting statements, many countries around the world still lacks such acts. Moreover, the act does not make shareholders responsible always because in many companies the shareholders do not sign on accounting statements or manage the company operations. Sundaram and Inkpen (2004. pp353) argue that the shareholder value maximization should be considered after all the liabilities of the corporate has been fulfilled - including incentives of managers, contractual liabilities, payments of dividends, principal & interest payments to bond holders, supplier du es, wages, salaries, etc. The net value addition in shareholder wealth needs to be taken care of after all such liabilities have been fulfilled that can be effectively managed through corporate governance. ... ffective corporate governance are conflicting objectives and hence need to be managed by different individuals to reduce the risk of conflict of interest. The non shareholding stakeholders should be engaged in corporate governance whereas the shareholders should be engaged in wealth maximization and the both parties should have a congenial environment to resolve conflicting situations. These roles should be normally fixed in support of the argument by Sundaram and Inkpen (2004. pp355) that the transition from non-shareholding stakeholders to shareholders is easy but vice versa is very difficult. Example, a CEO practicing effective corporate governance should be kept out of shareholding otherwise the conflict of interest scenarios will happen. Non shareholding CEOs will not indulge into high risk taking attitudes in the attempt to maximize shareholder wealth that may lead to the corporate failing miserably in meeting their obligations and the backfiring on shareholder wealth leading t o complete crash. The meltdown of organizations like Lehman Brothers is an ideal example of failure of control procedures on risk taking attitudes. To what extent the objective of shareholder maximization is constrained by agency theory Agency theory is an important aspect of corporate balancing acts given that individuals will divulge into those actions that maximize their personal utility. This forms an excellent baseline for creating a balance between shareholder wealth maximization and corporate governance. The current financial crisis that we are witnessing is the result of stretched risk appetite in the attempt to maximize shareholder wealth to the largest possible extent. Denis & Denis (1999. pp1072) presents the influence of agency theory on risk taking attitudes of corporate

Nigerian women Case Study Example | Topics and Well Written Essays - 3500 words

Nigerian women - Case Study Example The second section introduces the initial career goals set by female specialists in Nigeria. Next, the motivation for women joining banks is observed. An important qualitative measure - a level of job satisfaction with its connection to performance - is given after that. General issues regarding the career development of women in Nigeria follows then. After that a particular inequality issues are analysed in the order of the descending significance. At first issues regarding work-life balance are given. The next section speculates on theoretical assumptions of wage gap, glass ceiling, and occupational segregation connecting them to answers from the interview. After that the influence of the supervisor is drawn with special attention to mentoring. Then follows the analysis of the effect of cultural influence with assumptions on its adjustment. Finally, the conclusion briefly names all the results acquired in this research. Age of the respondents fluctuates from 25 to 45. It is important to notice that the research sample reflects the situation on the whole banking industry; that is most of the female employees working in Nigerian banks are married, well-educated women in their 30-40s. Note that there was no visible connection found between the age of the employee and the generation of bank (first/second). Most of the Nigerian women are occupied in the... The banking sector of Nigeria is interested only in skillful educated specialists, and it is hard for the average person to get into the ranks of the banks. Therefore we can suppose that each of the respondents has rather high social status. There is one Ph.D. degree, one candidate Ph.D. degree and six Master degrees. As can be seen from the Appendix 1 older female bankers have higher academic degrees. Additionally it should be noted that most of the respondents (six) have education in economics and only two of them have degrees in social sciences. The third important piece of the background portrait is the family status of the population. Social study of Nigeria shows that about 81% of women in the age from 15 to 49 were ever married (Isiugo-Abanihe 1998). Six respondents of our sample are married, one respondent is single, and one is divorced. The average fertility rate for Nigerian population is 5,4. Nevertheless, there are 3 female bankers with three children, 2 with two children, 1 having one child, 1 having four children, and one woman without children. As can be seen, the average amount of children in the research population is lower than that of the whole Nigerian population. This corresponds with findings in previous researches, which indicate that working women following their career paths usually have less stable families. Initial career goals Determining initial career goals is perceived as an important part of the career planning throughout the lifetime of a person, regardless of race and gender. Most of the researchers admit that employees usually achieve only those career objectives, which were planned. There's very little mystery about what career success requires. You