Research Essay Example | Topics and Well Written Essays - 2000 words

Research - Essay Example Based on the data from World health organization cigarette smoking and other forms of tobacco use kill more than 4 million people worldwide every year, with about 1.25 billion active smokers worldwide. With the same trends of tobacco use it is estimated that tobacco smoking will kill 8.4 million people a year by year 2020 (WHO 2000). Now even though these numbers are alarming the advertising of tobacco smoking is increasing in volume and specificity. It is estimated that in year 2006 in United States, the 5 largest tobacco companies spend 12.50 billion dollars on advertising, or more accurately more that 34 million dollar per day in advertising and promoting cigarette smoking. What is most important is that the as the cigarette smoking declines, the amount of money spend on advertising is drastically increasing (Slater et al 2007). Also some new price strategies that are designed by the tobacco companies, like price discounts that are paid to wholesaler and large distributors to lowe r the price of the cigarettes, actually lead to increased number of smokers among youth and adolescents in United States (Federal Trade Commission 2006). The advertising in tobacco industry goes as far as designing cigarettes that are specially attractive and appealing to women, where the targeting of women as smokers goes beyond marketing because the companies try to find specific factors of motivation, patterns of social activities associated with smoking, specific product preferences etc. in order to produce gender or age specific products (Carpenter et al 2005). As we can see the tobacco industry is a strong factor that is promoting the use of tobacco neglecting the negative effects of smoking in the process. Since tobacco smoking is a major health problem, the health system has very important role in promoting the negative effect of smoking and its participants: doctors, nurses, public health workers and other medical personnel. As stated by World health organization the public health community and health professionals should lead the way in solving the problem of tobacco use (WHO 2000). The role of health professionals is important because there are studies that show that the chances of smoking cessation increases after a patient receives advice from a health care professional (Fiore et al. 2000). There are many programs in the world designed to reduce the incidence tobacco use among physicians and other health care professionals around the world. There are information’s that indicate that maximum 10 percents of physicians in Australia, Norway, Canada, United States, United Kingdom and other developed countries smoke tobacco. This incidence is much higher among the countries in Europe. As opposite of this up to 40 percent or more of the physicians smoke in France, Italy, Spain, Turkey and other countries in Europe (WHO 1993). This is interesting because the study conducted by Emanuela and Anna 2009 also showed that incidence of tobacco use

A Science Column Essay Example | Topics and Well Written Essays - 1000 words

A Science Column - Essay Example A physical quantity is defined by the sequence of operations used to determine its value (Wiliamson). The grouping of several physical quantities to find out the values of each in relation to each other is what constitutes a physical law which is defined as. The laws of thermodynamics relate the heat with temperature changes in materials of different kinds. To be clearer on this, let us begin by defining the various laws of thermodynamics. To begin with the first laws which states that Heat is a form of energy, and energy is conserved (Wiliamson). Here the first law confirms that heat is a form of energy and that it can be conserved. This is seen when we use electricity in our homes, the electrical energy is usually stored in the form of water which is then used to drive turbines hence generating electricity which we often use in our homes. This can always be conserved to minimize wastages by either conserving the water stored in a dam or switching off the electricity when not in use . The second law of thermodynamics can be stated in three different ways as defined by three different scholars. For our study we are going to use the definition of Kelvin which states that No cyclic process exists which produces no other effect than the extraction of heat from a body and its conversion into an equivalent amount of work (Wiliamson). The second law of thermodynamics here brings out the reversibility of thermodynamic processes, that is heat is never lost to the surrounding environments given that all factors such as heat loss to the surroundings through evaporation and other heat transfer processes are under control. This is always carried out in the laboratory by using a calorimeter, a laboratory instrument which is used to measure the amount of heat generated through chemical reactions and other physical changes. The calorimeter is designed for this purpose as it is made in such a way that it can minimize heat loss to the surrounding environment as well as heat gain from the same thus ensuring that heat contained in the materials is the same that is used in the entire experiment. It was upon the realization of the limiting factors in the definition of the term temperature by the two thermodynamic laws that the Zeroth law was devised the help in bridging the gap that was omitted. The zeroth law suggests that If two systems are in thermal equilibrium with a third system, then they are in equilibrium with each other (Wiliamson). This law enables one to order systems according to the direction of heat flow when these two systems are put into contact with each other. For this reason, a system is said to be hotter if heat flows from it into the other system which in this case is considered a colder one than the other when these two systems are put into contact with each other. The reverse is however true in the other direction. The third law of thermodynamics on the other and explains that the entropy of a system approaches a constant value as the t emperature approaches absolute zero (Wiliamson). This law suggests that all motions in a material tend to come a standstill, cease within that particular material as the temperature of that material reduces to absolute zero. All materials however must reach a state whereby the temperatures reduce to absolute zero hence no thermodynamic motions occurring within them. The three laws of

Humanities Class Essay Example | Topics and Well Written Essays - 1750 words

Humanities Class - Essay Example In his work, Rousseau holds that the social interactions of individuals with each other are the root cause of all the wrongs happenings in the world and all the elements of corrupt individuals. He believed that when people are born, they are very free in state, their minds are not corrupted and they are pure as created by God. At that moment of time, the humans possess sense of love which is pure valuing someone’s existence in the world (Kant 1781). The individuals therefore hold a sense of harmony about themselves and those around them. But he adds that once humans become integrated with the social settings of the world like property ownership and interdependence, there is where unhealthy happenings occur in societies. It is where the sense of love disappears. He connects these unhealthy behaviours to the competition for resources and antagonism in the world among people. The following illustration outlines how cruelty originates from societal interactions (Hogarth 1751). In the text book, Rousseau believed that â€Å"human were originally pure and morally good in the eyes of others and originator† (Text book pg. 132). Humans lived together in a society that acted as a single large family where everyone loved and cared for one another. If one family lacked some basic need, the family could easily obtain it from the other family who had, they had shared responsibility. People grew together and lived together in harmony and mutual coexistence existed among them. They carried out their activities in unison (Hogarth 1751). There was division of responsibility where women became more sedentary and accustomed themselves to looking after the children while men went out to seek their common subsistence. The two sexes lived softer lives but unfortunately, the single individuals couldn’t fight the common enemy; the wild beasts. This therefore led to the grouping of the families

U.S .Virgin Islands Research Paper Example | Topics and Well Written Essays - 750 words

U.S .Virgin Islands - Research Paper Example The United States Virgin Islands are a group of islands situated in the Caribbean and are part of the United States. The main islands of the U.S Virgin Islands are the Saint Croix, Saint John and Saint Thomas. Additionally, there is also a historically Water Island, though it is much smaller, surrounded by many other minor islands. According to the 2000 Census, the population was about 108,612, which mostly consisted of individuals of Afro-Caribbean descent. The primary economic activity is tourism, even though the manufacturing sector is also huge.Originally, the U.S Virgin Islands were occupied by Ciboney, Carib and Arawaks. The islands were given their respective names by Christopher Columbus together with her virgin followers on their second trip to Saint Ursula in 1493. Many years thereafter, the islands were controlled by several European countries such as Spain, United Kingdom, the Netherlands, France as well as Denmark-Norway. In 1672, the Danish West India Company occupied S aint Thomas. The following year, it occupied Saint John, ultimately purchasing Saint Croix in 1733 from France. It is imperative to note that the U.S. Virgin Islands were formerly referred to as Danish West Indies. However, in 1916, Denmark sold the Islands to the United States under the Danish West Indies Treaty. Consequently, on March 31, 1917, the Virgin Islands were formerly possessed by the United States and were thereafter renamed the United States Virgin Islands. All the inhabitants of the Islands are given the U.S Citizenship. Types of Businesses or Industries The economy of the islands strongly depends on the U.S mainland. The primary economic activity is Tourism hosting about 2 million visitors. Furthermore, the sale of duty-free products to visitors from the U.S mainland also substitutes the earnings from the Tourism sector. However, there also exist a significant number of manufacturing companies in the islands, such as the petroleum refining industry, textiles, rum distilling, electronics, pharmaceuticals as well as watch assembly. St Croix has the largest petroleum refineries in the world. Additionally, rum is a major product, and earns money from the refunds of U.S excise duty at the rate of about U.S$ 40m per year (West p.753). International businesses and financial services are on the verge of growing in the Islands. Government Type The United States Virgin Islands are under the territory of the United States. Although the population of the United States Virgin Islands is citizens of the U.S., the y cannot take part in the presidential elections. However, they are allowed to take part in the presidential primary elections for the delegates to both the Democratic National Convention and the Republican National Convention. The law that disallows the United States Virgin Islands residents has received outcries from the elites, who claim that they are denied two of the most powerful rights that citizens of a democratic country ought to have; these are the ability to vote and choose their legislators (Todd). Nationally, the U.S Virgin Islands vote and elect a delegate to congress. However, the elected delegate cannot take part in floor votes but can vote in the committee. Virgin Islands People People from the Virgin Islands are known as Virgin Islanders, while those residing at respective islands are called St. Thomain, St. Johnian and St. Crucian as well as Water Islanders. During the early 1600s and mid 1800, the U.S Virgin Island population was majorly drawn from the European a nd African descent. White settlers, mainly from Holland, England, Denmark, Ireland and France, came to operate plantations, run shops and ware houses. African slaves outnumbered the European whites. These were slaves brought to work in the sugar plantations by the Caribbean. English is the official language in the U. S. Virgin Islands. However, a language known as Virgin

Dram Job Essay Example | Topics and Well Written Essays - 500 words

Dram Job - Essay Example In this regard, this paper discusses my dream job, critically highlighting the major factors and requirements of getting there. Undoubtedly, the fashion and apparel industry is a dynamic one with new trends setting in throughout the year. In this regard, I have always had an undying love for fashion and new trends primarily because my father used to buy me new clothes every time a new fashion trend set in. Additionally, I come from a strong Islamic background hat necessitate the followers to put on certain distinctive kinds of clothing. Owing to these factors, I have always aspired to work in a textile industry particularly as a high-ranking manager in order to help make clothes accessible to the human race. This is especially so after having watched certain regions in the world through the television, where adults had barely any clothes to cover their bodies. Primarily, my dream career is to set up a clothing company and run it as the CEO in Saudi Arabia. Although I am still in high school, I can clearly visualize myself managing this big textile company than manufactures a wide array of clothing. Perhaps it would be desirable if I elaborate why I prefer setting the company in Saudi Arabia. Since Saudi is my home, I prefer to operate there as the proprietor and because I am well versed with the country’s laws especially laws pertaining to business, I strongly believe that I will not face any major challenges during the startup. Besides, I have many friends back in Saudi Arabia who are very competent as far as marketing of fashion products is concerned and in this respect, their input will give my business a head start. Before I embark into any business or profession for that matter, I have to ensure that I successfully pursue and complete my studies to the university level. As part of my ambitions, I aspire to graduate from Cape Breton University (CBU) with a Bachelor of Commerce degree that will be very

Beautiful Mind Essay Example for Free

Beautiful Mind Essay John Nash first arrives as a new graduate student at Princeton University. There he meets his roommate Charles, a literature student, who soon becomes his best friend. He also meets a group of other promising math and science graduate students. John sometimes goes out to a bar with his fellow students to try to meet women, but is always unsuccessful. However, the experience is what ultimately inspires his work in the concept of governing dynamics, a theory in mathematical economics. After the conclusion of Johns studies as a student at Princeton, he accepts a teaching offer at a prestigious institution, along with his friends Sol and Bender. It is while at this post that he meets Alicia, a student with whom he falls in love and eventually marries. While at Princeton, Nash runs into his former roommate Charles and meets Charless young niece Marcee. John Nash receives an invitation to the Pentagon to crack a complex encryption of enemy codes. He is able to decipher these codes mentally, impressing a certain mysterious William Parcher. This man later encourages John Nash to work for the government by looking for patterns in magazines and newspapers for a Soviet Plot. Involvement with Parcher came with chase scenes and gunfire, Nash eventually became paranoid and began behaving aggressively. In an attempt to help out a friend, Sol followed Nash during one of his late night top secret drop offs. Here Nash was seen placing enveloped documents in a mailbox at an abandoned establishment. Then one day during a lecture, Nash was caught trying to flee. He was sedated and sent to a psychiatric facility where he was interrogated. Alicia Nash, desperate to help her husband, visits the abandoned building only to find the never-opened top secret documents that Nash dropped there. She confronted her husband with this evidence, which at first he tried to deny true. Eventually he realized that William Parcher and the top secret missions were in fact all a delusion. He had to go through a painful series of insulin shock therapy sessions. Afterwards Nash is released on the condition that he agrees to take antipsychotic medication. These drugs however, had side effects that affected his relationship with his wife. Frustrated, He secretly stops taking medication, which triggered a relapse. While bathing their baby, Nash becomes distracted and wanders off. Fortunately his wife manages to save their child from drowning. When she confronts Nash, he claims that his friend Charles was watching their son. Alicia was alarmed desperately trying to contact professional help. Charles, Marcee, and Parcher all appear to John and urge him to kill his wife rather than allow her to lock him up again. Just when Alicia was about to leave, Nash finally realizes that these people are not real when he observes that Marcee never gets old. Only then does he accept that all three of these people are, in fact, part of his psychosis. From then on, Nash tries to live with these delusions by ignoring them. In his struggle to ignore these hallucinations, he approaches his old friend and rival Martin Hansen, now head of Princeton University. He is accepted to teach again. He is honored by his fellow professors for his achievement in mathematics. He won the Nobel Memorial Prize in Economics for his revolutionary work on game theory. He got up and gave out his speech.

Strategies to Maximise Shareholder Value

Strategies to Maximise Shareholder Value Introduction Firms may have different objectives to achieve. However in theory, a firm should set its objectives to increase its value for its owners. Shareholders are the owners of a firm. Therefore according to theory maximising shareholders wealth is the fundamental objective of a firm. (Watson Head –Corporate Finance principles and practice 2007) Investors generally expect to earn satisfactory returns on their investments as they require increasing the value of their investments as much as possible. This is usually determined by dividend payout and or capital gains by increasing the market value of the share price. The managers of the company act on behalf of the investors, such as operating day to day activities and making decisions within the business. In another way they do have the control of the business entity. However, firms may have other objectives to achieve such as maximising of profits, growth and increasing its markets share. When achieving these objectives of a firm, conflicts may arise as a result of ownership and control. Managers may make their decisions on their own interests rather than achieving investors wealth. Discussing the investor related goals as described earlier, in theory behaviour of management should be consistent towards maximising shareholders wealth, enhancing the value of the business (Basely Brigham- Essentials of Managerial Finance).Value of the business is measured by valuing firms price of shares. Its essential to consider maximising of stock prices, and its impact to the investors and the economy as a whole simultaneously. Maximising profits is also an objective of a firm. It is determined by maximising the firms net profits. It is also can be described as a short term objective whilst maximising the value of the company is a long term objective for a firm (Financial Management –Kaplan Publishers 2009). Therefore it is not necessary, maximising profits as maximising shareholders wealth because there are number of potential problems can be occurred adapting to an objective of profit maximisation. It will be discussed in the latter part of the report. Earnings per share (EPS) is one of the main indicators of the firms profitability and it is a broadly used method measuring firms success, as it is determined return to equity in theory(Financial Management – Kaplan Publishers 2009).However, EPS doesnt expose the firms wealth since it is determined by using firms net profits. Therefore EPS is also exist the same criticism as profit maximisation above which will be discussing in the later part of the report. During the past ten years have seen a much greater emphasis on investor related goals. The conflict of ownership and control can be recognised as one of the significant causes which were affected investors and the world economy in the past ten years. The corporate scandals such as Enron, Maxwell and World com which occurred recent past had been lost investors confidence towards capital markets. Therefore its essential to consider the ethical behaviour and social responsibilities towards shareholder wealth maximisation simultaneously. It can also be said the institutional investors such as insurance companies and pension funds had also made a significant influence on investor related goals in the recent past. Review of Literature OBJECTIVE OF PROFIT MAXIMISATION According to Watson and Head 2007, whilst individuals manage their own cash flows, the financial manager involves in managing cash flows on behalf of the company, and its owners. In a firm financial management is concerned with taking decisions in three key areas which are financing, investing and dividend policy. Watson and Head also mentioned, shareholders wealth maximisation as the primary objective of the firm and at the same time the existence of other stakeholder groups such as creditors, employees, customers and community are also affected when adapting to a corporate goal. â€Å"However the firm may adopt one or several objectives in short term whilst its pursued the objective of shareholders wealth maximisation in long term†(Basely and Brigham; Essentials of Managerial Finance). Therefore it is essential to be considered the other possible objectives in short term as well as long term simultaneously. Reviewing one of the main objectives of profit maximisation, a classic article of Milton Friedman in the New York Times magazine 1970â€Å"The social Responsibility of Business is to Increase its profits† (Poitras, Geoffrey 1994). Considering classical views of Friedman (1970), Grant (1991), and Danley(1991), Geoffrey analysed the connection between shareholders wealth maximisation and profit maximisation, as an foundation for establishing an ethical analysis for shareholders wealth maximisation. However, Friedman had a moderate view later relating to the concept of profit maximisation towards social responsibilities. (Pradip N Khandwalla, Management paradigms beyond profit maximisation 2004) While there were similarities between these two objectives, Solomon; 1963, chp.2 highlighted the inconsistencies in his classic article (Poitras, Geoffrey 1994). Considering the above views from different authors, Geoffreys suggestion was â€Å"Even though there are significant consistencies between these two goals, the goal of profit maximisation has designed for the traditional microeconomic environment and for the firms which do not have the conflict of ownership and control. It is also assumed that its applied for the environment where there was no uncertainty and no stock issues†( Poitras, Geoffrey, 1994). According to Keown, Martin and Petty, 2008; Lasher 2008; Ross Westerfield, and Jordan; 2008, â€Å"Managers are encouraged to maximise its current stock prices by the shareholder theory, therefore the criticisms are understandable†. This approach determines the existence of agency problem towards incentive schemes, as incentives are rewarded with the continuous growth of share price and leads to an unethical behaviour of managers, towards manipulating the firms current stock prices (Daniel, Heck Shaffer). CONFLICT OF OWNERSHIP AND CONTROL The conflict of ownership and control was first identified by Adam Smith (RBS Review 1937) and he suggested that the Director cannot protect the other peoples money with the same way that he protects his money (Tony Howell; Shareholder ship model versus Stakeholder ship model). Its also mentioned in Tony and Howells article, that the separation of ownership and control make a significant influence for corporate behaviour and its deeply discussed by Berle and Means (1932). But La Porta et al. (1999) argued against Berle and Means, and he suggested â€Å"its different from the large corporations, because the shareholders of large corporations involved in corporate governance actively where managers are unaccountable† (Tony and Howell; shareholder ship model versus Stakeholder ship model). Winch (1971) suggested the goal of profit maximisation is consistent with the ethical theory of utilitarianism whilst allocating resources under different circumstances. (Poitras, Geoffrey 1994). Having considered Winchs suggestion related to the utilitarian theory and profit maximisation, Geoffreys   (1994) view was that, inter temporal behaviour is important   for firms and efficient investment has a significant affect towards maximising of profits as a result of uncertain future cash flows. It is also discussed the potential conflict of ownership and control. Therefore Geoffrey (1994) suggested the separation of ownership, the decision makers (managers) and owners (shareholders) are involved to the corporate structure. SHAREHOLDERS Vs STAKEHOLDERS Even though most of the economists and authors acknowledge the theory of shareholder wealth maximisation (Berle and Means, 1932; Friedman, 1962), other authors argued the criticisms of shareholder wealth maximisation. They argued that Shareholder Theory encourages the managers to make short term decisions and behave unethically as a result of the influence of the other stakeholders. According to Smith (2003) believed â€Å"Shareholder theory is prepared to maximise short term objectives at the expense of long term goals† (Daniel, Heck Shaffer; Journal of Applied Finance; winter 2008). However Daniel, Heck and Shaffer analysed the reasons for the criticism and the misguidance of the shareholders theory in their article about shareholder theory, â€Å"How Opponents and Proponents Both Get it Wrong?† The misguidance has been occurred as a result of pursuing a long term objective in shareholder theory. Managers should maximise the future cash flows and its important to con sider the stakeholders accordingly (Jensen, 2002; Sundaram and Inkpen, 2004a). According to Freeman (1984) a firm should consider both shareholders and stakeholders when making their business decisions. However Daniel, Heck and Shaffer describes that the stakeholder theory determines the same criticism as short term behaviour but the shareholder theory has got the protection for both shareholders and stakeholders in the long run. â€Å"Therefore stakeholder theory is not predominant to shareholder theory†. Daniel, Heck and Shaffer suggested the expected future cash flows to analyse the above scenario and they argued that its essential to undertake all the positive NPV projects to maximise shareholders wealth analysing towards maximising current stock price. If there was a goal of increasing of current share price, managers who are rewarded by incentives may attempt to boost the stock price of the firm. However Jenson (2005) and Danielson and press (2006) argued â€Å"the eff ort to increase or maintain the stock prices by management could be destroyed the long term values of the firm by manipulation, unethical behaviour, delaying NPV positive projects, reducing or not spending on research and development.† Jenson has taken Enron as an example for explaining the above scenario. The management of Enron had hidden their debts through off balance sheet activities and by manipulating the company accounts (Daniel, Heck and Shaffer). Therefore Daniel, Heck and Shaffer suggested that its essential to design strategies which are consistent with the objective of increasing future cash flows rather than adopting an objective of increasing of current stock price to maximise the wealth of shareholders. Freeman, Wicks and Parmar (2004) argued that â€Å"all the recent business scandals are oriented toward ever increasing shareholder value at the expense of other stakeholders† (Poitras, Jefforey; 1994) After a number of high profile firms collapsed i:e: Enron, WorldCom and Arthur Anderson in US and Maxwell, Polly Peck, BCCI, Barings bank in UK, its been determined the requirement of a good Corporate Governance (Tony Howell; the shareholder ship model versus stakeholder ship model). According to Tony Howell, Corporate Governance has been growing for the past 25 years and the foundation for Corporate Governance was placed, after the introduction of Cadbury report in 1992 (UK). Omran et. al.2002; Mills, 1998; Fera, 1997 suggested â€Å"the importance of Corporate Governance as a result of the new entrance of Institutional Investors to Capital markets, Globalisation of Capital markets, increase of Stakeholder and Shareholder expectations†(Tony and Howell). Analysis According to financial management theory, its assumed that the fundamental objective for a firm is to maximise shareholders wealth (Watson Head 2007).   Analysing the suggestions and arguments towards fundamental objective, it can be seen that not only in theory but also in the real world it is essential to maximise the wealth of shareholder. Analysing the objective of profit maximisation, overriding the classical economics views by Hayek (1960) and Friedman (1970), other authors, Solomon (1963) and Geoffrey (1970) argued about the criticisms associated with the objective of maximisation of profits. The conflict of short term goal of profit maximisation and long term objective of shareholder wealth maximisation can be identified as the main conflict. If a firm adapts to an objective of profit maximisation and the managers are rewarded incentives for achieving it, the agency problem could be arise. Therefore in such a situation managers may take decisions towards their own selfish interests, rather than on shareholders. Achieving their self interest managers may reduce costs by cutting research and development costs, reducing quality control measurements, reduce advertising, using lower quality materials. At the same time the NPV positive projects could also be postponed to reduce their costs to determine more profits in s hort term. Producing low quality products, losing market share, losing customer trust on their products and finally reducing financial performance could be resulted as a result of using low cost strategies. It may lead the business towards insecure stock prices in long run. The other criticism is profit maximisation does not appraise the associated risks. Therefore managers may undertake higher NPV projects to determine higher returns. â€Å"However higher the required returns, higher the risk† (Peter Atrill; Financial Management for Decision Makers, 2008). Investing on risky projects will result future cash flow problems. However, shareholders are assumed as rational investors who provide finance for firms to invest in future projects. As rational investors they require a reasonable return for their investments. Therefore it can be suggested that objective of profit maximising is different from the wealth maximising. Even though shareholder wealth maximisation is the fundamental, firms are not being able to reject the profit perspective goals, because there are stakeholder groups who is interesting about financial activities in a firm. In addition to shareholders, Managers, Employees, Customers, Suppliers, finance providers and the community at large are included in the typical stakeholder group. Therefore its essential to take account of profit maximisation within the firm. As a result of these multiple objectives managers can easily pursue their own interest. In real world, financial statements are used to assess firms performance. However, profits are defined as profit before interest and tax, profit after interest and so on. Therefore the ratio of Earnings per Share is often used instead of profit which is calculated using the net profits and the number of shares issued. Investors usually use EPS as a measurement of valuing stock. EPS is mostly used as it contains of net income of the firm, and it is also used as an indicator measuring firms future cash flows. Although the disadvantage is EPS does not determine shareholders wealth. However, firms value should be determined by the future cash flows and the risk also need to be considered which is associated to the cash flow. However as mentioned earlier, profits does not take account of risks. I:e:â€Å"Reported profit figures such as Biotechnological companies and other new economy ventures have insignificant relationship on its stock prices† (Financial Management –Kaplan Publishers, 2009). Therefore, in the short term theres an inconsistence between profit maximisation and increase in stock prices in a firm. According to Smith (1937), Berle and Means (1932) and Geoffrey (1994) the separation of ownership is involved the corporate structure. The conflict was mostly seen during the recent past, following the corporate scandals. According to Maria and William in the article of Privatisation and the Rise of Global Capital Markets (Financial Management; winter, 2000) â€Å"The past years there was significant growth in capital markets valuation, growth in security issuance as a result of the privatisation programmes†. The impacts of share issue privatisation are increasing market liquidity, pattern of share ownership (i:e: Individual and institutional investors such as Pension funds and Insurance Companies), and increasing of number of shareholders in many countries. However, globalisation was also affected on firms activities simultaneously. Therefore the firms (i:e: Enron Maxwell), which had poor Corporate Governance had the possibility to involving in unethical activities such as creative accounting and off balance sheet finance(Financial Management, Kaplan Publishers; 2009). At the same time Directors involved in high level of corporate takeover activities, achieving their personal interest such as empire building, large remuneration packages (Financial Management, Kaplan publishers; 2009). Further analysis of Stakeholder theory and Shareholder theory by different authors, Jenson â€Å"2005) and Daniel and Press (2006) argued the criticism of stakeholder theory, whilst Daniel, Heck and Shaffer (2008) and Freeman (1984) argued the importance of both shareholder and stakeholder theory. However, it can be suggested that the stakeholders play a significant role towards increasing shareholders value. As an example to motivate employees of the firm, they should be treated in a good manner by rewarding increments, bonuses and so on. Long term employee satisfaction could drive the firm towards higher performance and the development of the business by increasing higher productivity and better quality of products. Simultaneously, building up a trust among customers and acquire and maintain the industry leadership. At the same time shareholders provide finance for firms for its working capital management and noncurrent assets for its future projects. Therefore it can be seen an inter relationship and importance of shareholders and the other stakeholders. According to Peter Atrill, (Financial Management for Decision makers , 2008)â€Å"In the early years financial management theory was mainly developed as part of accounting and the suggestions and arguments were based on casual observations rather than theoretical frame work†. But after the number of high profile firms collapsed, the requirement of corporate governance occurred. Number of committees met and discussed to improve the Corporate Governance and the main concern was the conflict between shareholders interest and managers. Enron was the seventh largest listed company in US when its collapsed in 2001 as a result of manipulation of financial statements. Its affected to shareholders, more than 20000 employees worldwide, creditors and customers (Janis Sarra; St Johns Law Review ; Enrons Repercussion in Canada). The 11 titled â€Å"Sarbanes Oxley Act 2002† CONLUSION By analysing the review of literature, it can be suggested that its essential to maximise shareholder value rather than maximising profits alone. However maximising profit is also can be defined as a performance measurement of a healthy business. Extremes of profit maximisation can also be caused unethical behaviour of management towards its shareholders and stakeholders. Although, Earnings per Share inconsistent with the long term value of shareholder, its still can be used as a performance measurement, since its got firms net profit. As a result of recent corporate scandals such as Enron, WorldCom and Arthur Anderson, shareholders and other stakeholder groups had given much emphasis on corporate behaviour. The unethical and illegal behaviour of those high profiled firms were lost investor confidence of capital markets. They identified the importance of Corporate Governance which provides the â€Å"road map† for managers to follow, pursuing different objectives towards the firm (Basley Brigham). At the same time the arrival of Sarbanes Oxley Act 2002 provided investors a much more confidence and strength towards capital markets. However, stakeholders are also important for firms. They are also treated well for the to maintain a Even there are conflicts between stakeholder theory and Shareholder theory, it‘s necessary to balance these two theories. According to Cathy Haywards article (Black – hole sums; Financial Management May 2003), during the period of May 2003 the pension funds in US and UK were in a bad condition. According to the assessment of National Association of Pension Funds, there was a drop in UK pension funds by more than  £250 million in 2002. Its being told that there were many reasons for the crisis but, the huge drop in stock market during the economic down turn 2000-2003 has mainly been affected. The pensions funds are heavily depend on the dividend payments and the stability of the equity markets, as a result of the drop in share prices the pensions funds struggled to meet their obligations. References Besley Brigham â€Å"Essentials of Managerial Finance† Daniel, Heck Shaffer Journal of Applied Finance; Fall Winter 2008 – Shareholder theory,  Ã‚   â€Å"How Opponents and Proponents Both Get it Wrong?† Denzil Watson Antony Head â€Å"Corporate Finance (electronic resource): principles and practice 2007 â€Å"Management paradigms beyond profit maximisation† – Colloquium a debate by S K Chakraboty, Verghese Kurien, Jittu Singh, Mrityunjay Athreya, Arun Maira, Anu Aga, and Anil K Gupta. Maria K. Boutchkova William L. Megginson â€Å"Privatisation and Rise of Global Capital Markets† , Financial Management;   Winter, 2000, p31-76 Peter Atrill â€Å"Financial Management for Decision Makers† 5th Edition 2008 (electronic resource) Poitras, Geoffrey â€Å"Share Holder wealth Maximisation, Business ethics and social responsibility, Journal of Business Ethics; feb 1994;13,2;ABI/INFORM Global pg125 Rebecca Stratling â€Å"The Legitamacy of Corporate Social Responsibility† ; Corporate Ownership and Control; Volume 4; Issue 4, Summer 2007 Tony Ike Nwanji, Kerry E. Howell; â€Å"A review of the two main competing models of Corporate Governance: The Shareholder ship model versus the Stakeholder ship model; Corporate Ownership and Control, Volume 5, Issue 1, Fall 2007