What do you mean by maximizing value of the shareholder?

Answer:

This management principle, also known undervalue based management, states that management should first and foremost consider the interests of shareholders in its business decisions. Although this is built into the legal premise of a publicly traded company, this concept is usually highlighted in opposition to alleged examples of CEO's and other management actions which enrich themselves at the expense of shareholders. Examples of this include acquisitions which are dilutive to shareholders, that is, they may cause the combined company to have twice the profits for example but these might have to be split amongst three times the shareholders.

First answer by Mehedi2000. Last edit by Mehedi2000. Contributor trust: 1 [recommend contributor recommended]. Question popularity: 1 [recommend question].