In an outsider regime where the capital market has been usually developed, if
the shareholders do not happy with the performance of the company, the financial
market seems to be their best place to enter or exit, therefore, if performance of
company does not please investor, the threat of take-over from selling of share
through the financial market. . The benefit of this kind of market mechanism is to
discipline management to seek a maximum dividend as a company goal. This
argument is strengthen and confirm when there has been an increasing number of
institutional shareholder where they usually just seek a return as their main objective,
because it would be more difficult for management to focus on other matters than
making profit as a shareholder will. Another reasons including calculating the costbenefit
of conducting business for other stakeholder such as for community or
employee is very difficult to calculate it. However, it would still be difficult to
include this cost if there is no internationally acceptance for this calculation.