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Ch_035

Ch_035

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Published by Akash saxena

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Categories:Types, School Work
Published by: Akash saxena on Feb 17, 2011
Copyright:Attribution Non-commercial

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02/17/2011

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Chapter -35
Shareholder Value andCorporate Governance
 
BY Akash Saxena
Chapter Objectives
R
eview the implications of financial theory for the corporate finance policies.
Emphasise the need for a linkage betweenthe financial policies and strategicmanagement.
Explain the implications of sustainable growthmodel.
Focus on the shareholder value creation.
Develop a framework for the shareholder value analysis.
Discuss the concept of economic valueadded (EVA) and market value added (MVA).
 
BY Akash Saxena
F
inancial Goals and Strategy
T
wo important tasks of the financial manager are:
allocation of funds (
viz.
investment decision) and
generation of funds (
viz.
financial decision).
T
he theory of finance makes two crucialassumptions to provide guidance to thefinancial manager in making these decisions.
T
he objective of the firm is to maximise the wealthof shareholders.
Capital markets are efficient.

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