“For whose benefit and at whose expense should directors operate the firm.” A historical debate that still stands today with the same tension it did one century ago. Alongside theoretical academia, different jurisdictions still in dispute on whom should receive the attention of a firm; shareholders or other stakeholder constituencies, including employees, creditors and customers.
Corporations are the primary vein of any country’s economy. The profound influence they carry on peoples’ life, place them in a sensitive position that requires continual evaluation. Nonetheless, this continuance evaluation has been largely surrounding the discussion of the actual objective of companies. Although a company is an entity whose “defining characteristic is the attainment of a specific goal or purpose,” there is no actual agreement on what that goal or purpose should be. For centuries academics have been asking: Should directors merely care about maximising shareholder profit or … [....]