The goal of corporate financial management – sustainability requirement

Gintaras Černius

Abstract


This paper tackles different issues related to the development of the system of objectives of corporate financial management that also includes company’s sustainability. Prior to the recent financial crisis, the formulation of corporate financial management objective focused only on the company’s finances that were reported and measured by using company’s profit and its worth growth ratios. The financial crisis has highlighted an additional aspect of corporate management, i.e., a need for the company, as an object of the owners’ investment, to generate economic benefit for a prolonged period of time. For the purpose of formulation of the corporate financial management objective it is appropriate to refer not to a single objective or a set of same-level objectives; a much more expedient approach is the creation of the so-called objective tree integrating the requirements of the entity’s going concern. The article analyses certain factors affecting financial performance of a company, discusses different ratios indicating the quantitative effect of the factors upon the final results, and shows practical applications for management by means of interference model with a view to ensuring the operations of the company for a sufficiently long period of time.

Keywords


corporate finance; management objective; sustainability

Full Text:

PDF (Lithuanian)

Article Metrics

Metrics Loading ...

Metrics powered by PLOS ALM

Refbacks

  • There are currently no refbacks.




"Business Systems & Economics" ISSN online 2029-8234