Value : The Four Cornerstones of Corporate Finance
- Hardback | 272 pages
- 155 x 235 x 19mm | 494g
- 02 Dec 2010
- John Wiley & Sons Inc
- New York, United States
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Corporate leaders are regularly confronted with conventional wisdom and half-truths about value creation. They're given conflicting advice about what will or won't appeal to investors, often contradicting their own judgment about what builds lasting worth in their companies and the economy.
In Value: The Four Cornerstones of Corporate Finance, partners from the management consulting firm of McKinsey & Company describe the basic principles of value creation and their relevance. Internalizing these principles--or cornerstones--gives decision makers the independence and courage they need to challenge conventional wisdom, defy half-truths, and build thriving businesses.
The four cornerstones are:
The Core of Value: a business's value is driven by its growth and return on capital, and resulting cash flows
The Conservation of Value: value is created when companies generate higher cash flows, not by simply rearranging investors' claims on cash flows
The Expectations Treadmill: movements in company share prices reflect changes in the stock market's expectations, not just underlying performance
The Best Owner: the value of a business is not an absolute but, rather, depends on who is managing it and the strategy pursued
While there are many books that cover selected topics within corporate finance--often for specialized practitioners--it's the rare book that offers leaders a unifying viewpoint of business. Value is that book.
Back cover copy
"Value will help senior leaders and their boards act on bold ideas for creating value in the businesses they lead. The four principles of value creation are a concise guide to growing and shaping companies."
--Ed Breen, Chairman and Chief Executive Officer, Tyco International Ltd.
"In a complex business world, we shouldn't overlook the relatively simple financial principles that underlie the creation of long-term shareholder value. This book gives corporate leaders a clear base of knowledge for creating and sustaining value under any economic, industry, or company circumstances."
--Dominic J. Caruso, Chief Financial Officer, Johnson & Johnson
"More than a handbook, this is the bible of value creation. It should be read by corporate leaders across the entire spectrum. It also reminds us not to ignore the abiding financial principles that guide companies to long-term value creation."
--Stefan Krause, Chief Financial Officer, Member of the Management Board, Deutsche Bank AG
"A valuable source of guidance for business leaders who are focused on creating real, lasting value."
--Mark Loughridge, Senior Vice President and Chief Financial Officer, Finance and Enterprise Transformation, IBM Corporation
"A very useful, no-nonsense guide for creating shareholder value. Competition, capital structure, acquisitions, buybacks, dividends, and more--it's all here with straightforward principles and examples."
--Keith S. Sherin, Vice Chairman and Chief Financial Officer, General Electric Company
"If more owners and executives had the overriding objective of long-term value creation--and enough knowledge about how to create it--then our financial world would be a more stable one."
--Rajiv Singh, Vice Chairman, DLF Limited
"Value cuts through clutter and myopia to provide a sound foundation for leaders who are building enterprises that thrive and serve society."
--Daniel Vasella, MD, Chairman, Novartis AG
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