ABSTRACT
The objective of all companies is to make a profit and it must be sufficient, after meeting the cost of all the constraints, to allow a satisfactory return on the owner's capital. Only the owners can say what 'satisfactory' means to them and it is part of the corporate planner's job to advise the directors what this is. There is no reason to think that all owners demand an ambitious and challenging target to be set, although most will require as good a return on their money as they can get elsewhere. A board of directors may not set the company a target below the level that would satisfy the shareholders: they may set a target higher than that which would satisfy them provided that in order to achieve it they did not appreciably increase the risk of the shareholder's investment.
