The Corporate Objective addresses a question that has been subject to much debate: what should be the objective of public corporations? It examines the two dominant theories that address this issue, the shareholder primacy and stakeholder theories, and finds that both have serious shortcomings. The book goes on to develop a new theory, called the Entity Maximisation and Sustainability Model. Under this model, directors are to endeavour to increase the overall long-run market value of the corporation as an entity. At the same time as maximising wealth, directors have to ensure that the corporation survives and is able to stay afloat and pursue the development of the corporation's position. Andrew Keay seeks to explain and justify the model and discusses how the model is enforced, how investors fit into the model, how directors are to act and how profits are to be allocated. Analysing in depth the existing theories which seek to explain the corporate objective, this book will appeal to academics in corporate law and corporate governance as well as law, finance, business ethics, organisational behaviour, management, economics, accounting and sociology.
Postgraduate students in corporate law and corporate governance, directors, and government regulators will also find much to interest them in this study.
'This is legal scholarship of the finest kind, concerned with an issue of supreme political, economic and social importance. Professor Keay takes the debate on the object of the modern public corporation by the scruff of its neck and skilfully navigates between the Scylla and Charybdis of the shareholder/stakeholder debate. This book, characterised by admirable analytical clarity and a huge amount of research, faithfully summarises the debate hitherto, and propels us to the next stage with a powerful argument, which challenges, effectively, both the stakeholder and shareholder theories.' - Harry Rajak, University of Sussex School of Law, UK
Contents: Preface 1. Public Companies: Context, Theory and Objectives 2. Shareholder Primacy 3. Stakeholder Theory 4. An Entity Maximisation and Sustainability Model 5. The Enforcement of the Entity Maximisation and Sustainability Model 6. Investors 7. Managerial Discretion and Accountability 8. Allocation of Profits 9. Epilogue
Series: Corporations, Globalisation and the Law
Tertiary; University or College
Number Of Pages: 360
Published: 1st May 2011
Publisher: Edward Elgar Publishing Ltd
Country of Publication: GB
Dimensions (cm): 24.13 x 16.51
Weight (kg): 0.53