Why the goal of a corporation is wealth maximization rather than profit maximization?

Answer 1

Wealth maximization: To stay invested and multiply your invested money. The term is used for long-term investors.

Short-term investors work for profit maximization. They sell their shares, as and when they get profit from the market.

Answer 2

Wealth pertains to an individual, whereas profit maximization more typically relates to a company.

When discussing a company's financial position, an accounting/finance person would never refer to a company as "wealthy". There are, however, many measures of profitability ($ left after paying expenses) and liquidity (funds available for operational purposes) such as net income, gross income, net operating income, etc. Liquidity would be referred to using measures such as current ratio (current assets/current liabilities) and related. Note that these measures all pertain to a company's earnings, or its ability to continue operations insofar as it has enough $$ to keep stocking shelves and paying suppliers.

As a side comment, a public corporation is owned by its stockholders, which on average in large part include 401K type investments. So the owners of the company are individuals with savings in this type of fund. If a company focused on being good corporate citizens and making charitable donations, 401K funds would tank. Note that the corporate executives are employees at will of the owners; if the CEO fails to deliver value to the owners, he or she can be terminated. Food for thought when reading about greedy execs; that if these folk stop focusing on making money for the owners for whom they work, they could be fired.