Reference no: EM132843470

Attention to the interests of shareholders above all other groups is implicit in much of what is taught to accounting and finance students. The very construction of a profit and loss account ... is a continual, and usually unstated, reminder that the interests of only one group of stakeholders should be maximised. Indeed it may be very difficult for accounting and finance students to even conceive of another way in which affairs could be ordered ... even at the algebraic level, let alone the moral.

Problem a) Do you agree or disagree with Collison, and why?

Problem b) If 'profit' maximisation is biased towards maximising the interests of only one stakeholder group, would you expect that over time there will be less emphasis on profits and more emphasis on other performance indicators? Why? What might be some of the alternative measures of performance?

Problem c) Would Collison's comments provide a justification for moves towards profit measures that incorporate 'full costs' (that is, that consider the externalities of business)?