Are companies legally obligated to maximize profits for the stockholders?

[ZombieHorde]

If they are, could you provide a link to the law?

(This is for school.)

[MannyGoldstein]

1. Yes

The Directors of a public company have a fiduciary responsibility to the shareholders, e.g.: http://www.shajlaw.com/media/reports/BoardofDirectorFiduciaryDuties.pdf

[Nuclear Unicorn]

2. They have a fiduciary responsibility to act in the best interests

of the stock holders. In other words the officers can only pay themselves what the stock holders approve etc.

I presume your question centers on a hypothetical: what if they spent more on worker's benefits in lieu of profit?

Is there a law preventing them from doing that?

No.

But there is a stockholder's vote. If the holders don't think their return is being maximized they can have the officers replaced.

[Traveling_Home]

3. No - depends on their incorporating documents, Execs, Boards, shareholder's decisions.....

Ben & Jerry's

[ZombieHorde]

4. Thanks everyone, "fiduciary" was the key word for my searches.