Welcome to free paper download website

Shareholders of for-profit: the root causes of corporate profit

Author: WangYongXin From: www.yourpaper.net Posted: 2010-03-27 14:13:15 Read:
Abstract: The shareholders of for-profit as the fundamental dynamics of the investment company is to promote the company's capital accumulation, the overall economic efficiency is an important principle. Adhere to the shareholders of for-profit is not only can protect the effective implementation of corporate social responsibility, but also can improve the corporate governance based on the pinpoint company philosophy, values, and promote the harmonious development of the economy fundamentally.
Keywords: shareholders for-profit; value orientation; social responsibility

The point of view of the Chinese and foreign law experts agree is a for-profit company, the shareholders of for-profit and hide in the the company supplier corporate profit behind. Ensure that shareholders of for-profit and to maximize the benefits to be derived as a company, of course, meaning. According to the contract economics point of view, as a contract, although it is by different property owners (mainly owners of physical capital and human capital owners) by the property rights trading, but not to say that these property owners are the owner of the company, are entitled to the ownership of the company. Company, what property owners should be entitled to the ownership of the company, the key depends on whether the property owner is company risk takers. From the characteristics of the property, & the separability of physical capital and its owner, the physical capital naturally has secured easily as a "hostage" by other members, are also vulnerable to other staff "abuse"; human capital its owner can not be separated, it does not have a mortgage function, other members can not be treated as a "hostage". Thus in the normal state, the company's risk takers "natural" physical capital owners (shareholders), rather than human capital owners. [1] Thus, shareholders as the company's real "masters", with the for-profit nature, requiring the most profitable is taken for granted. ке

A profit, shareholders value basis

Create and reflect the value of shareholders' investment, to protect and maintain high profits run, the company is responsible for its shareholders, the company profit as the primary or only goal, which is the fundamental conflicts and contradictions and the Chinese Confucian culture rooted in the people's way of thinking Confucian culture tend to swing justice and benefit relations in extremely contradictory position to examine. Relic of the so-called gentlemen's justice, the gentleman is not made profits so didactic, always seems to be for-profit and moral as a contradiction that can not have both fish and bear's paw. [2] Therefore, to correctly understand the value of the shareholders for-profit foundation for the development of company law applicable and economic benign operation is very necessary. ке
From the point of view of the philosophical theory of value, the value of the formation process, the subject is always according to their own needs and understanding of object attributes, and then set goals and carry out practical activities around the target to create new value, in order to meet people needed. Again and again, to push the body to continue to pursue new value, new value, new value pursuit. [3] in the development process of the company, shareholders of investment companies subjective undoubtedly to seek profit-making as its fundamental goal, the company naturally as the object of course, has the service shareholder role to create maximum value for shareholders much change, regardless of the level of economic and social human concept shareholders' profit-seeking, it is like the truth of the business operations like always played a fundamental role in the operation of the market, despite the connotation of the profit-seeking of shareholders has been developed from straightforward short-term profit-seeking a deeper complex and far-reaching social responsibility issues.
First of all, the pursuit of shareholder profit-maximization, is determined by the sexual instincts of human self-interest. Hume said: "We recognize that people have a certain degree of selfishness, as we know, selfish and humanity can not be separated, and is inherent in our organization and structure, driven by selfish nature, and the pursuit of wealth and contempt for the poor and lowly. [4] Adam Smith pointed out that people's behavior is rational (Rational), self-serving, are based on individual utility maximization as the basic driving force, which is the so-called economic man. According to Adam Smith's point of view, everyone in the community will do its utmost to use their own capital to maximize the benefits. [5], the company's shareholders, in principle, with intent to serve the public, not knowing what is the contribution to society, his only concern is the safety and interests of the investment. People as if by an invisible hand to lead the improvement of society, not consciously do what. The so-called "subjective for self, the objective for others." Visible, shareholder profit is the driving force behind the development of competition in economic life So, to get rid of the shackles of the traditional concept of the gentleman talk about Lee, acknowledged that the pursuit of profit-maximizing shareholder value, precisely from the historical materialism of this aspect to understand many of the problems of the Companies Act, is to face the reality of objective research methods and angle . ке
Secondly, adhere to the shareholders of for-profit, the pursuit of maximizing shareholder value, the basic principles of corporate governance in many countries. U.S. economist Alfred Rappaport, once said, "maximize the creation of shareholder wealth, is the tradition of the American Enterprise". [6] However, the principles are the biggest challenges from stakeholder theory, the theory that the operation and management of the company should not be treated as the shareholder only object, in addition to other outside shareholders main, such as employees, creditors, and the communities and The government should be the object of concern. But economics point of view according to the contract, the pursuit of shareholder-profit does not actually harm the interests of other stakeholders, on the contrary, it is based on the assurance that the premise of the interests of other stakeholders. The company is a combination of a contract between the various stakeholders. According to the contract, managers, employees, suppliers, and they come together voluntarily, using funds provided by investors to the production of a hope that customers are willing to buy products. If managers are unfair to treat any one of the stakeholders, that is a violation of the provisions of the contract, then the stakeholders will interrupt this transaction. If a company is trying to drive down the wages of employees, it can not be hired to staff it wishes and needs of a certain quality. If its supplier payment deferred, the supplier will increase the supply price, or to cancel the credit. If the products do not meet the quality promised by the company, the customer will give up buying and steering its competitors. [7] Therefore, from the point of view of corporate governance, shareholders as investors and operators in large part is relatively independent of the main body, will have treatment costs, which requires corporate governance should coordinate and standardize the company system stakeholder behavior institutional arrangements and rights to follow the principle of efficiency, reasonable arrangements for governance objectives. If the emphasis on the interests of the stakeholders, all stakeholders are placed in the same position, will inevitably lead to a multiplicity of corporate governance objectives. This will not only make company managers lose a unified code of conduct, causing confusion of corporate governance, conflict of interest and will make the existing shareholders and other stakeholders, or between different stakeholders is more difficult to coordinate and balance, thereby increasing the difficulty of governance, increased treatment costs. In this way, managers can easily own negligence or opportunistic behavior to find a legitimate excuse and reason to conceal it. In fact, let the senior managers of all stakeholders responsible equivalent they are irresponsible for anyone and everyone to become owner of the result will be that nobody is the owner. [8] Therefore, adhere to the shareholders of for-profit, is involved in corporate governance, shareholder value is a very practical point of view, economic efficiency proper show. ке

Second, of shareholders profit and corporate social responsibility balance

In the business community, the shareholders' investment in its fundamental purpose is to earn maximum profit. As Adam Smith in "The Wealth of Nations" mentioned companies as much as possible the efficient use of resources to produce the products and services of the needs of the community, and consumers are willing to pay the price to sales, the company fulfilled its own social responsibility. The sole task of the company is to the extent permitted by law, the pursuit of profit in the business to maximize. The company's main task is to maximize profits, in fact, show that service for shareholders commercial purposes. Can say with certainty that, if the company is not to shareholders for-profit service, can not guarantee the realization of shareholder profit, companies such basic organizational form of the value of its existence will be greatly reduced. The history of the Companies Act, the status and role of shareholders in the company due to different places and different, but any time the Company Law will not deny shareholders the master. Even in the employee-oriented and creditor-oriented company law, top employees or creditors in corporate governance structure will not override the shareholders. And, as a result of the global competition, the Law of the country is increasingly reflected in the convergence for the shareholder-oriented corporate law. [9] ке
 1/3    1 2 3 Next Last
Please consciously abide by Internet-related policies and regulations.
Tips: Log in to comment, the user name to enter comments directly from your personal space, so that more friends to meet you.

Company Research latest papers

Sponsored Links

Company Research papers Ranking

Latest free papers

Sponsored Links

Top