Création de valeur, 10 ans après…
Value based management was considered as the major managerial innovation of the nineties: managers were to supposed to be turned into owners through redesigned compensation packages including value creation metrics such as EVA and the like, increased influence of shareholders on firms’ strategies… Ten years later it is about time to come back. This article indeed revisits a study made at the time by the authors on the implementation of VBM and analyzes the evolutions observed since then. It identifies the main achievements such as the better management of assets and cost of capital, and the difficulties encountered in the alignment of managers’ compensation on market value. It discusses the current trend towards more operational performance indicators in that respect.
|Date of creation:||Dec 2009|
|Date of revision:|
|Contact details of provider:|| Postal: ESSEC Research Center, BP 105, 95021 Cergy, France|
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- Stephen Riceman & Steven Cahan & Mohan Lal, 2002. "Do managers perform better under EVA bonus schemes?," European Accounting Review, Taylor & Francis Journals, vol. 11(3), pages 537-572.
- Gneezy, Uri & Rustichini, Aldo, 2000.
"A Fine is a Price,"
The Journal of Legal Studies,
University of Chicago Press, vol. 29(1), pages 1-17, January.
- Jensen, Michael C & Murphy, Kevin J, 1990.
"Performance Pay and Top-Management Incentives,"
Journal of Political Economy,
University of Chicago Press, vol. 98(2), pages 225-64, April.
- Brian J. Hall & Jeffrey B. Liebman, 1998.
"Are CEOs Really Paid Like Bureaucrats?,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 113(3), pages 653-691.
- Dial, Jay & Murphy, Kevin J., 1995. "Incentives, downsizing, and value creation at General Dynamics," Journal of Financial Economics, Elsevier, vol. 37(3), pages 261-314, March.
- Stephen F. O'Byrne & S. David Young, 2006. "Incentives and Investor Expectations," Journal of Applied Corporate Finance, Morgan Stanley, vol. 18(2), pages 98-105.
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