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¶ … Stockholders
The decision that the champion of AHF is faced with in this particular case study is a business decision. One may argue that most business decisions involve ethics, particularly those that directly affect the livelihood of its employees. However, USHF is not a charity organization. It is a business organization that is attempting to make a profit. In that regard, the decision of whether or not to discontinue AHF immediately or to allow it to continue with serious reductions to its workforce for the next couple of months is purely based on business concerns and outcomes.
Although AHF has produced some value, it is not engendering profits at a rate swift enough to satisfy its stockholders. Moreover, it is negatively impacting the profits of its parent company, USHF. USHF initially conceived of AHF and located it in Sri Lanka because it believed that doing so would help it further its own goals. If the opposite effect is being produced -- that AHF's operations are actually draining USHF's profits, which they are -- then the decision to shut this operation and restart it again elsewhere that is more technologically viable is simply good business. As such, this decision is primary about business, and scarcely involves ethics.
The goal of shareholder wealth certainly factors into the decision of whether to...
From a purely business perspective, the company (UHSF) is actually owned by the stockholders. They have the individual shares in the company that collectively grants them ownership. As such, the impact of the business decision on them and their stocks is of primary importance in this particular case. All parties involved in this decision must be aware of that fact that in actually, they are working for those individuals who own stock in this company.
If the decision in this case study were up to me, I would not hesitate to shut down operations in Sri Lanka at the present time instead of waiting another six months. The reason for this decision is two-fold. Firstly, it is quite clear that there are numerous other members of this company that are in favor of abandoning its operations in Sri Lanka and conducting them elsewhere. Perhaps the most eminent of these is Landon who, as a member of upper level management, has a viewpoint that should considerably affect all employees who hope to have a future with this company. Additionally, it is clear that people in finance are unwilling to prolong operations in Sri Lanka. Their likening of doing so to a charity organization certainly emphasizes this fact. Moreover, the reality that the company would have to cease contributing to…
Communities are looking for social expenditures by the business to benefit the community (hospitals, stable employment, donations, and investments). Managers face a challenge in making such crucial decisions. Therefore, corporations must be clear on how to make tradeoffs between these often inconsistent and conflicting interests from different stakeholders. In the Shareholder Wealth Maximization model, three types of maximization exist in a company. They include total stakeholder maximization, shareholder maximization and
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Publicly Traded Firm: WalmartWalmart proudly has built its brand image and value proposition on offering the lowest prices to consumers at all times. The downside to this boast is that it has come under fire for not paying employees a fair wage, and not offering its workers adequate benefits. It must, to answer such concerns, find a way to ensure it can still offer low prices using its business model
Freedom/Capitalism: Compare&Contrast Freedom and Capitalism Economists look at the state of the world economy and invariably come to different conclusions; the nature of a market economy is to be unpredictable. In today's economic environment, the battle is still waging between the various forms of capitalism, and the very definition of what it means to be free is being challenged from two viewpoints. First, we have the view that economic freedom, without government