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Research Papers Collection » 2018, issue 4(40), Management, Rzepka Anna

ANNA RZEPKA: Ethical aspects of shareholder value objective

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AFFILIATION OF THE AUTHOR: Cracow University of Economics, Faculty of Management

ABSTRACT: Over the past decades, the ideology of shareholder value, which implies that the sole legitimate purpose of the corporation is to maximize shareholder profits, has unquestionably been a dominant principle for corporate governance. Today, there is a significant question-mark over whether shareholder primacy theory provides the proper framework for running companies. The global financial crisis has renewed the fierce discussion about which concept the management of a modern public corporation should primarily follow. At the same time, ethical and sustainability-related issues have received a considerable amount of attention in the strategic management literature. The main objective addressed in this paper is to contribute to the shareholder and stakeholder theory discussion with a closer look taken at some ethical aspects of the adoption of shareholder-value oriented model. The article aims to emphasize that corporations should look beyond the pursuit of shareholder wealth and adopt more modern, socially and ethically conscious business model.

KEY WORDS: business ethics, shareholder value, shareholder value theory, shareholder value maximization

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