Creating the Economic Value and the Connections between this and the Classical Indicators of Performance
Author:
Univ. Lecturer Mirela GANEA, Ph. D.
JEL:
G30, M10
DOI:
Keywords:
economic value added, correlation analysis, economic and financial performance indicators
Abstract:
Creating value and maximizing shareholder wealth forms two framework concepts in building business strategy of corporate companies. At their level, the analysis of the value created is no longer limited to quantifying it as a numerical expression of an indicator (economic value added-EVA), but it takes the form of a complex process of identifying value creators factors and their connections with the economic value. Factors that create value are nothing but classic indicators quantifying different aspects of a company (operating, investing or financing).\r\nThe author achieves a descriptive research of the concept of economic value creation and review of the literature presenting practical studies undertaken, at the international level, of the links established between the economic value added and various other performance indicators. This paper is a first step of a postdoctoral research in the field of performance measurement through indicators of value creation and provides an important theoretical and practical foundation on the variables which determine the growth by a firm, econometrics techniques used in the detection of these connections and conclusions drawn for different samples of firms.\r\n