Company leaders are legally obligated to act in the best interests of the company and the shareholders. That is related to profit maximization, but it's not the same thing.
The actual legal obligations are fairly narrow such as protecting minority shareholders. But, that rule is only in effect for the most egregious situations as there isn’t a strict ranking between objectives. Reducing pollution more than legally mandated is a tradeoff between profits, reputation, and shareholder wellbeing. It’s simply not obvious what the correct tradeoff would be and things get even more fuzzy when you include risks.
The CEO, for example, needs to push for a compensation package that shareholders see as fair. If not, they can file a derivative lawsuit as a remedy.
In well run public company the CEO’s don’t set their own compensation package they negotiate with a board who does. In that negotiation the CEO has zero legal obligations with respect to the company they are in effect an independent entity at the time. Of course this is assuming an independent board, conflicts of interest can still happen.
Not that different from 'effective altruism', really. Maybe running a Ponzi is moral if you are taking the money from people who are not effective altruists, but you are saving the planet or something?
Or Kant's categorical imperative, act in a way that you would want to make universal law. Then in order to act morally, you have to solve for all downstream impacts of the action over all time, if everyone acts that way.
Seems computationally intractable, possible multiple local equilibria, problems with which discount rates to use and whatnot.
Hence the popularity of simple ethical systems, just do what God says on the tablets and be done with it.
That's the cool thing about shaky theoretical foundations and fuzzy data, you can project anything you want onto them and act with a great deal of moral certainty about everything.
Shareholders can't sue the CEO of Whole Foods for failing to stock profitable Coca-Cola products. If the CEO says that's the right decision for their brand, reputation and market positioning - that's precisely the sort of professional judgement the CEO was hired to make.
Take a leveraged buyout for instance. The company takes on a perhaps fatal amount of debt, the employees stand to lose their jobs, the shareholders might benefit if the LBO works out, but they lose if the company goes bankrupt. Who wins? The vultures who organized the LBO, because their downside is limited and their upside is highly leveraged.
Company suffers. Shareholders suffer. Some insiders benefit. And it's still legal.
Another example. Executives award themselves generous option packages. Then they announce a massive buyback program, which drives the stock price up (by arithmetic). The executives' options go to the moon. Big companies like Facebook have incinerated hundreds of billions in shareholder value this way. But it's legal, shareholder interests be damned.
Facebook returned profit to shareholders via buybacks.
If you invest in a company, you expect to make a return. There are two ways to do this: dividends or selling your equity.
Dividends drain cash from the company to repay investors. Stock buybacks drain cash from the company to repay investors.
Both are in the interest of shareholders! What is the other option? Make profit forever and never return anything to shareholders? Then we’re not talking about an investment. It’s crypto-ponzi all over again.
During the 2021 mania the share buybacks accelerated, even though executives could easily have waited a year or two and sat on their money as the zero interest rate era was coming to an end.
You don't want to do buybacks at $300 a share when your company is going to trade at $100 in a year. Because the shares you bought will then be $200 underwater. A buyback is a stock transfer between a party that believes the stock to be overvalued to the company. And in this case of facebook the seller was right and facebook was wrong.
You can sell your stocks to someone else. The company doesn't have to be the one to buy it.
Also, remember, investments do come with risk.
But that defeats the purpose. The company buys back stock not to hold it, but to dissolve it and drive up the value of remaining shares mathematically.