Question

what goals might be pursued by managers instead of maximization of shareholders wealth

Answer 1

Explanation:

Instead of seeking to maximize some objective (such as shareholder wealth), managers “satisfice, ” or seek acceptable levels of performance, while maximizing their own welfare. Maximization of their own personal welfare (or utility) may lead managers to be concerned with long-run survival (job security).

Answer 2

Managers can consider self development and overall workforce development objectives.

• According to shareholder maximization, management should strive to increase current value of potential future returns to the firm's shareholders.
• Higher the probability of obtaining a potential reward, lower the value benefit for investors. Thus, managers can pursue appropriate success standards when optimizing own wellbeing, rather than maximizing shareholder wealth.
• Managers may be worried about long-term survival due to their need to maximize their own personal welfare.
• A personal improvement goal may improve a specific ability or broaden expertise in a specific field. Providing workers with a range of objective setting learning resources also contributes to overall organisation success.