The main reason there are conflicts of interest in a business is because people within the business all want different things. For example, the people that work in the business making and doing things (i.e. factory and office workers) will all want a higher pay and better working conditions. Therefore they would want to see more money invested on machines/computers that they work on and better facilities. Managers, will want to pay themselves more and pay the workers less so that they are better off, and also would want to find the cheapest way of making and selling a product. On the other hand, another manager might be a lot more eco friendly and would rather spend more money on research to find new ways to make the product without harming the environment as much. Also people higher up the hierarchy might want to expand the business, however the shareholders would rather profit maximise so they get higher dividends.
English: No Business Like Show Business. Building ...
Company Business Movie Poster
Animal,Porkey Pig, Lobund-WistarUsually in a plc there are many people involved, such as the managers, the workforce and the shareholders as well as many other stakeholders. This means that the managers will have to keep them all happy, money wise, as well as give themselves enough money. However sometimes this isn't always done the way people want it to be done. For example, the shareholders might start complaining to the directors of the company that they aren't getting enough dividends, so therefore they will want to the directors to start profit maximising. However the directors might want to expand as they feel that that would be the best thing to do in the long term. Also workers will want higher pay and better worker conditions. Pressure groups might also want to see some of the profits of a plc goes to a charity,