Shareholder Wealth Maximization
Interactive

Shareholder Wealth Maximization

Intuition Publishing
Updated Sep 24, 2020

The long-term goal of every corporation is the maximization of the wealth of its shareholders. However, company executives, who act as agents for shareholders, may pursue other objectives such as short-term profit maximization, or may even act in their own self-interest. Companies must therefore align the interests of both agents and shareholders in order to maximize shareholder wealth.