BNZX－业绩评估1(PPT 106页)

Executive Summary
Objectives
Background
Performance Measurement Framework
Market Value Added (MVA)
Economic Profit (EP)
Cash Flow Return on Investment (CFROI)
Exercises
MVA
Economic Profit
Case Study - Diageo

 

Corporate performance evaluation has evolved from the 1960s focus on ROE to the current variations of economic profit that measure impact on shareholder value
many firms have devised their own variations of economic profit
Stern Stewart’s Economic Value Added (EVA)TM   is best known of these measures
Holt/BCG’s Cash Flow Return on Investment (CFROI) is a similar concept presented in % return format

Both ROE and EP are business metrics, tools used to measure the performance of the business
separate from fundamental business drivers, the actual factors that influence shareholder value, and output measures the backward-looking records of overall company performance

Focusing on EP instead of ROE decreases the likelihood of destructive behavior by managers
By evaluating managers based on EP, manager behavior can be altered such that only projects that add value (with NPV>0) are undertaken, which does not always occur with ROE

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