David Bourget (Western Ontario)
David Chalmers (ANU, NYU)
Rafael De Clercq
Jack Alan Reynolds
Learn more about PhilPapers
International Journal of Business Governance and Ethics 2 (s 3-4):237-253 (2006)
This paper investigates the assertions that EVA is more highly associated with shareholder wealth and firm values than are traditional performance measures. Two commonly used value-based performance metrics namely, Total Shareholder Return (TSR) and Tobin's Q were also considered to highlight the value-relevance of EVA vis-a-vis these measures in predicting shareholder wealth. Using a panel sample of about 1000 American firms over the period 1990 2002, the study found compelling evidence consistent with the notion that EVA outperforms other traditional performance measures in explaining shareholder wealth. Value-relevance tests reveal EVA to be more highly associated with shareholder wealth than TSR and Tobin's Q. The incremental value-relevance tests have also suggested that EVA possesses the largest explanatory power over TSR and Tobin's Q. These results conclusively support the claims made by EVA proponents and further support the potential usefulness of EVA metric for internal and external performance measurement.
|Keywords||No keywords specified (fix it)|
|Categories||categorize this paper)|
Setup an account with your affiliations in order to access resources via your University's proxy server
Configure custom proxy (use this if your affiliation does not provide a proxy)
|Through your library|
References found in this work BETA
No references found.
Citations of this work BETA
No citations found.
Similar books and articles
Geoffrey Poitras (1994). Shareholder Wealth Maximization, Business Ethics and Social Responsibility. Journal of Business Ethics 13 (2):125 - 134.
Rim Makni, Claude Francoeur & François Bellavance (2009). Causality Between Corporate Social Performance and Financial Performance: Evidence From Canadian Firms. [REVIEW] Journal of Business Ethics 89 (3):409 - 422.
Michael Devaney (2007). MBA Education, Business Ethics and the Case for Shareholder Value. Journal of Academic Ethics 5 (2-4):199-205.
Kathleen Rehbein, Jeanne M. Logsdon & Harry J. Buren (2013). Corporate Responses to Shareholder Activists: Considering the Dialogue Alternative. [REVIEW] Journal of Business Ethics 112 (1):137-154.
Dendi Ramdani & Arjen Witteloostuijn (2012). The Shareholder—Manager Relationship and Its Impact on the Likelihood of Firm Bribery. Journal of Business Ethics 108 (4):495 - 507.
Eva T. H. Brann, Peter Kalkavage & Eric Salem (eds.) (2007). The Envisioned Life: Essays in Honor of Eva Brann. Paul Dry Books.
Lorne N. Switzer & Catherine Kelly (2006). Corporate Governance Mechanisms and the Performance of Small-Cap Firms in Canada. International Journal of Business Governance and Ethics 2 (s 3-4):294-328.
Stanley Paulo (2003). Epistemology, Research Methodology and Rule 702 of the Federal Rules of Evidence Versus Eva®. Journal of Business Ethics 44 (4):327 - 341.
Peter Koslowski (2000). The Limits of Shareholder Value. Journal of Business Ethics 27 (1-2):137 - 148.
Added to index2009-01-28
Total downloads8 ( #169,667 of 1,100,749 )
Recent downloads (6 months)1 ( #289,565 of 1,100,749 )
How can I increase my downloads?