Discuss the similarities and differences between shareholder wealth maximization and stakeholder wealth maximization

  1. What competencies were you able to develop in researching and writing the course Comprehensive Project? How did you leverage knowledge gained in the intellipath assignments (Units 1- 4) in completing the Comprehensive Project? How will these competencies and knowledge support your career advancement in management?
    • Competencies developed in researching the project are strategic perspective, customer focus, spotting trends, risk taking and difficulties of doing business around the world.
    • I leverage knowledge gained in Intellipath assignments to support my standpoint of international expansion and global distribution. Certain information helped me further understand the financial markets outside of the country and credits provided by financial institutions.
    • The competencies and knowledge will support my career advancement by allowing me to gather as much information as possible before making a strategic decision. Knowing the advantages and disadvantages of options available will aid me in making fair and sound decisions in management.
  2. Discuss the similarities and differences between shareholder wealth maximization and stakeholder wealth maximization.
    • Firm’s objective is to maximize shareholders’ wealth by achieving the highest possible total return to equity. The stakeholder-owner has resources and interests which are important for the commitment of other stakeholders and thus for the economic performance of the venture and for the distribution of stakeholder benefits. Difference is shareholders are more risk averse and would take the risks to strain for the long-term success of their entity. They would sacrifice current revenues to reinvest for the future wealth maximization. Stakeholders highly focuses on the present-day revenues of an entity. They prefer profit maximization goals that are more concerned with their earnings.
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