VALUE-BASED MANAGEMENT: A CASE STUDY OF VISEGRAD FOUR COUNTRIES

Research background: As companies evolve over time, so do their goals. In the past, the main goals of companies were profit and goals (as market share), are no longer relevant or effective. These goals are outdated, and companies have replaced them with goals that are consistent with the current changing times of competition. Worldwide, most large companies are using, or planning to use, a new approach called value-based management that focuses on value creation. Therefore, the main goal of companies using a value-based management approach is value creation. Purpose: This study aims to validate the existence of a statistically significant relationship between the economic value added (EVA) indicator, which represents the successful implementation of the value creation process in companies, and selected value generators. Method: For this study, information about 14,313 companies operating in the Visegrad Four countries were collected from their respective financial statements. The research period was 2019–2020. Twenty value generators were selected for this study. The hypotheses were tested using the correlation coefficient. The strength of the relationship between the observed variables is described by using the Pearson correlation coefficient. Findings and value added: A trivial or small dependence was observed between the EVA indicator and non-current assets, current financial assets, and income tax. A moderate dependence was observed between the EVA indicator and stocks, receivables, interest expenses, and other liabilities. A large dependence was observed between the EVA indicator and bank loans, profit and loss (P/L) statement, and the cost of capital. The survey results can be a useful tool for businesses in their efforts to focus on a suitable value generator in the process of value-based management implementation, focusing on the process of value creation.

Analyzing the Impact of Corporate Governance Factors on Enterprise Value and Capitalization

Subject. The article focuses on business valuation methods and factors with reference to corporate governance principles. Objectives. I analyze how corporate governance factors influence the value and capitalization of public joint-stock companies, and make my suggestions concerning financial and administrative decisions in line with value-based management. Methods. The study is based on methods of synthesis, deduction, induction, statistical analysis, comparison and generalization. Results. Having analyzed the impact of such factors, as revenue, dividends paid, return on sale and equity, for an 11-year life span (2009–2019), on capitalization and value of the population made up of 20 Russian public joint-stock companies from four sectors, as classified by the number of owners and State interest, I figured out that capitalization enterprise value in Russia most of all depend on indicators of companies if it has 11 owners and more (71%), companies without the State interest (67%). As for basic factors, these are revenue and dividend policy that have the strongest effect on enterprise value, while capitalization depends on all the analyzable factors. Conclusions and Relevance. Currently, business valuation and business valuation management are critical for making correct strategic administrative decision. Doing so, the appraiser shall not only measure enterprise value with available financial results, but also consider its various non-financial indicators, which inter alia include corporate governance. Based on corporate governance principles set forth in the Letter of the Bank of Russia, I pointed out that definitely influence the enterprise value. Based on the above analysis, I determined what best results the Russian public joint-stock companies can attain in their corporate governance by sector, the number and quality of owners. Following the findings, I suggest how financial and administrative decisions on enterprise value management should be made, in line with the value-based management principles.

Mapping the potential aggregation values of ecotourism landscapes from stakeholder survey, structural equation modeling and GIS: Case study of Moc Chau site, Vietnam

The primary aim of this study is to propose a potential landscape value assessment from different dimensions rather than the traditional approach of a composite indicator. The method used in this study is the combination of data collection from stakeholder survey, score measurement for landscape value dimensions using Structural Equation Modeling (SEM), and spatial representation with the support of Geographic Information System (GIS). From a large-scale (n = 400) investigation in the Moc Chau district, the statistical data extracted from the survey provides input data for the score determination process. SEM analysis shows that each landscape site has 11 determinants influencing the landscape value assessment. Using the RMSE comparison (for validation) with different interpolation methods, the ordinary kriging method is chosen to model the aggregation landscape value map of Moc Chau District. About 24.97% total area of the study area has great potential for tourism development, being mainly distributed in the center of a high mountainous area. This approach can be used as a model to advocate local and regional assessment and enhance value-based management in other territories in Vietnam and beyond.

Pengaruh Value Based Management Pada Nilai Ekuitas Perusahaan Dengan Corporate Social Responsibility Sebagai Variabel Pemoderasi

The purpose of this research is to examine that the disclosure of Corporate Social Responsibility moderate the relationship of Value-Based Management with the corporate equity. This research was conducted at the Indonesian Stock Exchange in the year 2019 to 2020. Purposive sampling method was used to determine samples and 103 observations were obtained. The statistical analysis which was done included the classic assumption test and goodness of fit test. Testing the influence of moderating variables in this research hypothesis was conducted using Moderated Regression Analysis (MRA) which is a special application of multiple linear regressions. Based on the research results and their discussions, it can be concluded that the disclosure of Corporate Social Responsibility is not proven significantly as a moderating variable of the relationship between the Value-Based Management with the corporate equity. It is indicated that way because investors do not need to look at the disclosure of Corporate Social Responsibility anymore which has no longer been a voluntary but a mandatory. Using Value-based Management as an indicator which is measured by the Economic Value Added, the investor does not consider the corporate social responsibility in making investment decisions. This is consistent with the concept of Value-based Management that investors tend to have a main purpose to obtain maximum returns from investment with the view that the economic value of a commercial enterprise is legitimated only by the benefits gained.

Prior credit assessment of long-term SME projects with non-standard cash flows

Over the past three decades, the relative bank loan demand has changed due to the arising small and medium-sized enterprises (SMEs). Therefore, banks in their operations face the problem of processing an ever-increasing number of loan applications. The aim of this paper is to develop an auxiliary approach to assessing the prior creditworthiness of long-term SME projects with nonstandard cash flows.This study reveals how the principles of value-based management can be incorporated into the process of borrower’s creditworthiness assessment to improve the process of screening loan applications. For this, the internal rate of return was used as a criterion for loan granting decision at the initial stage of loan underwriting.An algorithm for the preliminary evaluation of loan applications is proposed and is based on the principle of maximizing the shareholder value of banks. This algorithm helps to define the credit terms taking into consideration the distribution of positive cash flows throughout the project’s expected economic life, calculate the possible real effective interest rate concerning the borrower’s nonstandard cash flow schedule, make a rough analysis on the economic efficiency of lending and state the necessary criterion to initiate the procedure of loan underwriting for the projects with nonstandard cash flow schedules. The proposed estimation algorithm stemming from the IRR-approach for the cash flow analysis can also be initially used by a borrower as a tool for credit solvency self-testing via screening of periods with corresponding cash flows that can be used for loan servicing.

Studi Kepustakaan Penerapan Value Based Management Dalam Perusahaan

Sekarang ini fokus dalam penciptaan nilai telah meningkat diseluruh dunia dalam beberapa tahun terakhir ini, kekuatan yang mendorong dibalik perubahan ini yaitu lingkungan yang lebih kompetitif dan aktivisme investor yang meningkat yang menyebabkan investor individu dan institusi mengharapkan tingkat kinerja yang lebih baik. Tujuan : Adapun tujuan dari penelitian ini untuk mengetahui penerapan value based management yang dilakukan perusahaan untuk memaksimalkan kekayaan pemegang saham. oleh sebab itu dalam rangka menciptakan nilai bagi pemegang saham, diperlukan pertumbuhan perusahaan dengan nilai tambah strategi pertumbuhan melebihi modal tambahan yang telah diinvestasikan oleh pemegang saham. Metodologi Penelitian : jenis penelitian yang digunakan peneliti adalah menggunakan penelitian studi kepustakaan dengan mengambil data dari buku, makalah atau artikel, jurnal dan sebagainya. Laporan penelitian ini disusun dengan prinsip kesederhanaan dan kemudahan karena mengingat keterbatasan kemampuan peneliti yang belum mampu melakukan kajian pustaka secara mendalam dan mendetail. Pembahasan : Value Based Management merupakan pendekatan untuk mengelola dimana perusahaan membangun, mempromosikan dan mempraktekkan nilai organisasi bersama. Economic Value Added merupakan penciptaan nilai bagi pemegang saham dengan elemen dasar capital employed, Financial Strategy Matrix merupakan matriks yang digunakan untuk membantu mengevaluasi dan mengendalikan keuangan perusahaan. Market Value Added digunakan untuk menilai sukses tidaknya perusahaan dalam menciptakan nilai bagi pemegang saham. Growth Value Map merupakan alat diagnosis yang digunakan untuk menaksir strategi dan menggambarkan strategi dalam penciptaan nilai. Kesimpulan : Pengukuran peningkatan kemakmuran pemegang saham yang paling langsung adalah harga pasar saham. jika harga saham mengalami peningkatan, maka kita akan mengatakan bahwa kemakmuran pemegang saham meningkat dan begitu juga sebaliknya.