maximize shareholder wealth?

[Nelson]

what's the point of maximizing shareholder wealth? when you have an IPO and the insiders of the company make their cut whats the point of even caring about the shareholders anymore. You've raised your money you can do whatever you want with it, shareholders can trade all they want on the market and assign any price they want to the share. Why do corporations care about maximization shareholder wealth? thanks
in response to Eddie's comment: so before the managers of the company used to work for themselves and now they're working for the owners correct? so what if managment is more concerned with making their paycheck than increasing owner's wealth? what are the incentives for managment to align themselves with owners view? Also what about facebook IPO and the killings insiders made? is that related? what is your view?

[Eddie W]

If you think once the corporation goes public, the corporation could start to dump the stocks to the market to get every possible dollar, you are wrong.

Let alone it's illegal. I am not going to talk about the legality of it. If people don't do things because they are illegal, we could be living in a next to perfect world. People don't do things only because there is no money involved.

Company goes public to absorbe the working capital is for a long term view, not to run a scam.

[cactusgene]

After an IPO, the officers of the company must in fact be interested in maximizing shareholder value, because they want to hold onto their jobs in running a major company which is a big feather in their cap.

You brought up the example of Facebook. That company is an anomaly, because it was a badly overpriced priced IPO issue. The majority of the inside shareholders did not make a killing in the IPO, because their stock was looked up for 4-6 months. And after the stock already shed one half of its value and the look-up expired for the largest block of those restricted shares last week, the stock did not tank as many, if not most in the investment community expected, but rather it gained more than 20% since. So the conclusion has to be that investors believe that the company is working in the best interest of the shareholders, which was helped along with positive news on the revenue side and forecast for the coming year.