Maximizing Shareholder-Value: A Panacea for Economic Growth or a Recipe for Economic and Social Disintegration?

Critical Perspectives on International Business, Vol. 4.1, pp. 55-74, 2008

32 Pages Posted: 1 Jul 2010

See all articles by Brendan McSweeney

Brendan McSweeney

University of London, Royal Holloway - School of Management

Date Written: Feburary 19, 2008

Abstract

Purpose - To examine the claim that the pursuit of maximum value (wealth) for shareholders optimizes economic and social benefits for society as a whole.

Design/methodology/approach - Evidence cited in support of the claim and the methodology employed by its supporters are examined. Counter-evidence from a wide range of disciplines, including accounting, economics, finance, and medical sociology, is considered.

Findings - The evidence does not support the claim. Bias and severe methodological flaws in its supporters' research is revealed. Considerable evidence of adverse consequences is identified.

Keywords: Shareholder value, wealth inequality, corporate governance, capital markets, financial markets

JEL Classification: L21, A11, A13, A14, D21, D81, G1, G3

Suggested Citation

McSweeney, Brendan, Maximizing Shareholder-Value: A Panacea for Economic Growth or a Recipe for Economic and Social Disintegration? (Feburary 19, 2008). Critical Perspectives on International Business, Vol. 4.1, pp. 55-74, 2008. Available at SSRN: https://ssrn.com/abstract=1286743 or http://dx.doi.org/10.2139/ssrn.1286743

Brendan McSweeney (Contact Author)

University of London, Royal Holloway - School of Management ( email )

Egham
Surrey, Egham TW20 8DG
United Kingdom

Register to save articles to
your library

Register

Paper statistics

Downloads
194
Abstract Views
1,053
rank
154,211
PlumX Metrics