The Role of the Financial Manager

The Role of the Financial Manager <Tab/>The primary goal of every corporation is to maximize shareholder wealth, primarily through cash dividends and share value appreciation. To this end, the role of the financial manager is to act in accord with this premise. Under his/her auspices, the financial manager must determine which factors affect the company's stock price, and which choices will add value to the company, all the while …

…risk/reward profile. Beyond maximizing shareholder wealth, financial managers also have the responsibility of acting ethically, particularly in today's financial markets with increasing media coverage and regulatory scrutiny over corporate financial scandals. While the decision to misappropriate funds or misrepresent financial statements may have a short-term positive gain on shareholder value (as shareholders are misled and trading on false information), the gain is quite short lived, and the long-term effects of such decisions are dire.