Explore BrainMass

Corporate v. Shareholder Conceptions

Referring to the case file attached, can somebody guide me through the following question:

The case describes two conceptions of managers' responsibilities (on the ninth page). Which do you favour: the shareholder conception or the corporate conception? Does your stance make a difference in this case?


Solution Preview

There are two conceptions of managerial responsibility: the shareholder conception and the corporate conception.

Both of the conceptions are well-documented, however the shareholder conception is the more traditional view. The shareholder view places the shareholder or stockholders at the centre of the company. It recognizes their position as the real owners of a company. This means that the company has primary responsibility for the financial well-being of the shareholders. The company's goal, in other words, should be to increase value for the shareholders.

The corporate conception places the company and its executive managers at the centre. Under this view, the needs and goals of the management are perceived to be of utmost importance. This doesn't mean that the shareholders are not listened to, ...

Solution Summary

Explains the differences between the shareholder and corporate conceptions, using Marriott as the example.