What is shareholder value?

Shareholder value refers to the financial worth or returns that individuals or entities, called shareholders, receive from investing in a particular company. It is an important concept in finance and business, as it indicates the profitability and success of an organization. Shareholder value can be measured in various ways, such as through dividends, capital gains, or returns on investments. Maximizing shareholder value is often a key goal for businesses and is achieved through effective management, strategic decision-making, and generating sustainable profits. However, critics argue that a sole focus on shareholder value can prioritize short-term gains over long-term sustainability and other stakeholder interests.

This mind map was published on 14 August 2023 and has been viewed 109 times.