Publications
Detailed Information
Mutual Trust : A Critical Linkage Between Value Appropriation and Value Maximization
Cited 0 time in
Web of Science
Cited 0 time in Scopus
- Authors
- Issue Date
- 1998-06
- Citation
- Seoul Journal of Business, Vol.4 No.1, pp. 5-38
- Keywords
- two processes ; roles of managers ; shareholder value
- Abstract
- Although value appropriation and value maximization are
fundamental for any firm's economic activities, previous research has
tended to treat them separately and to focus on each issue while taking
the other for granted. This paper suggests that the two processes, i.e.,
value appropriation and value maximization, are not separate; rather,
they are highly interrelated and reinforce each other through mutual
trust among major stakeholders, a crucial linkage between the two
processes. Specifically, this paper presents that fair value appropriation
- i.e., appropriating value to the stakeholders in proportion to their
stakes in the firm - contributes to the development of trust from the
stakeholders, not only directly, but also indirectly through strengthening
moral obligations of internal organizational members, particularly
managers, to the stakeholders. The present paper also shows how
mutual trust with the stakeholders leads to value maximization. After
examining the reinforcing effects of value maximization on value
appropriation, this paper concludes with some discussion about social
legitimacy of a firm and the roles of managers.
- ISSN
- 1226-9816
- Language
- English
- Files in This Item:
Item View & Download Count
Items in S-Space are protected by copyright, with all rights reserved, unless otherwise indicated.