The market for control disciplines management and directors to serve shareholder interests through mergers, acquisitions, hostile takeovers, proxy contests, and depressed market valuations.

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The market for control incentivizes management and directors to focus on actions that will serve shareholder interests, such as pursuing mergers and acquisitions, engaging in hostile takeovers, engaging in proxy contests, and attempting to boost the company's market valuation. This dynamic can create pressure on company leaders to prioritize short-term gains and financial performance over longer-term stability and sustainability.

The Market for Control Disciplines Management and Directors to Serve