Why profit cannot be the sole objective of business?


Profit cannot be the sole objective of business due to the following reasons.

1. Disregard of Stake Holders:

Profit helps to save the interest of shareholders alone. But business also has obligations towards other stakeholders such as employees, customers, Government, society, etc.


2. Mis Guide Management:

In their craze for maximum profits managers may undermine the firm’s-future. They may fail to invest in executive development, research and development, etc.

3. Overstress the Ends:

Profit maximisation overlooks the means that may be used. Any means which are against social interest are injurious to business even if they generate huge profit.


4. Outdated:

Profit maximisation is inconsistent with modern trends in business. Diffusion, of share ownership, Professionalisation of management, growing social consciousness, etc. is some of these trends.

Thus, profit is one of the objectives of business. It should not be the sole objective of any business enterprise.

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