Neoclassical economics and several management theories assume that the corporation’s objective is profit maximization subject to capacity constraints. The central focus is shareholders as the ultimate residual claimant, providing the necessary financial capital for the firm’s operations (Jensen and Meckling, 1976; Zingales, 2000). However, there is substantial variation in how corporations actually compete and pursue profit maximization. Different corporations place more or less emphasis on the long-term versus the short-term (Brochet, Loumioti, and Serafeim, 2011); care more or less about the impact of externalities from their operations on other stakeholders and the environment (Paine, 2004);.
