EC249 Lecture 3: Lecture 3 EC249
Document Summary
Goals for international financial management: maximization of shareholder wealth, long accepted as a goal in the anglo-saxon countries, but complications arise. Who are and where are the shareholders. In other countries shareholders are viewed as merely one among many. Stakeholders of the firm including: employees, suppliers, customers. In japan, managers have typically sought to maximize the value of the keiretsu a family of firms to which the individual firms belongs. But managers may pursue their own private interests at the expense of shareholders when they are not closely monitored: demonstrated by a series of recent corporate scandals such as enron, The importance of corporate governance: the financial and legal framework for regulating the relationship between a firm"s management and its shareholders. Issues are especially serious where legal protection of shareholders is weak or virtually non-existing: examples: indonesia, pakistan and russia;
