Comment by daveguy
4 hours ago
The executives are trying to maximize shareholder value. They are shareholders through options at the least. The board can also own shares (which should be illegal).
4 hours ago
The executives are trying to maximize shareholder value. They are shareholders through options at the least. The board can also own shares (which should be illegal).
The executives are trying to make more money. They get paid in shares so making the share price go up makes them more money. Whether or not the means used to achieve that end are beneficial to other shareholders is beside the point. This is potentially a violation of fiduciary duty.
> They get paid in shares so making the share price go up makes them more money. Whether or not the means used to achieve that end are beneficial to other shareholders is beside the point.
The point was, increasing shareholder value is equivalent to increasing their own paychecks. So they are doubly incentivized to choose shareholder value over other values. Most people would still choose health/life of other humans, but the incentives are certainly off without regulation.