Asked by Hannah Gutzmer on Jul 02, 2024
Verified
The argument against a shareholder model and in favor of a stakeholder model rests in part on the notion that:
A) Corporations are legally sanctioned by the government and thus the rights of shareholders are not unlimited.
B) According to utilitarian ethics, managers have a moral obligation to consider all perspectives.
C) According to libertarian ethics, managers must preserve the freedom of all stakeholders in their decision-making.
D) A focus on short-term profits will, in the long run, maximize utility in society .
Stakeholder Model
A theory of organizational management that emphasizes the importance of considering the interests of all stakeholders in decision-making processes.
Shareholder Model
focuses on maximizing value for shareholders as the paramount objective of a company, often at the expense of other stakeholders.
Utilitarian Ethics
An ethical theory that posits the best action is the one that maximizes overall happiness or utility, considering the greater good for the greatest number of people.
- Gain an understanding of the essential principles behind shareholder and stakeholder models in corporate governance.
- Understand the moral considerations in balancing the maximization of shareholder value with the interests of stakeholders.
Verified Answer
Learning Objectives
- Gain an understanding of the essential principles behind shareholder and stakeholder models in corporate governance.
- Understand the moral considerations in balancing the maximization of shareholder value with the interests of stakeholders.
Related questions
Under a Shareholder Model, Managers' Primary Obligation Is to Act ...
When It Comes to Labor Relations, Which of the Following ...
According to the Stakeholder Model of Corporate Governance, Which of ...
More Information Would Be Shared with Employees and Their Representatives ...
Stakeholder Theory Asserts That While There Are Other Stakeholders in ...