The primary goal of financial management is to maximize shareholder wealth, which means increasing the value of the company for its owners over the long term. This is often referred to as wealth maximization and is considered a more comprehensive and modern objective than simply maximizing profits. Wealth maximization focuses on enhancing the company's market value and share price by making strategic financial decisions that consider risk, time value of money, and sustainable growth

. While profit maximization-aiming to increase earnings in the short term-is important, it is limited because it does not account for the timing of returns or risks involved. Wealth maximization, on the other hand, aligns financial management with the long-term interests of shareholders by focusing on cash flows, dividends, and the overall market reputation of the business

. In summary, financial management aims to:

• Maximize shareholder wealth by increasing the company's market value and share price.
• Ensure sustainable long-term growth and financial stability.
• Make informed decisions about resource allocation, risk management, and capital investment to achieve these goals