Publisher's Synopsis
In the corporate world, the ability to create wealth is considered a key measure of a company's success. However, not all companies are equally adept at generating wealth for their shareholders. In her research paper titled "Assessing Firms as Wealth Creators or Destroyers," Madhavi Eswara examines the factors that determine whether a company is a wealth creator or a wealth destroyer.
The paper provides an assessment of select firms using value-added and performance metrics.
The book uses a sample of 20 firms across different industries and sizes to examine the extent to which they create or destroy wealth for their shareholders.
The findings of the study reveal that there is a significant variation in the ability of firms to create or destroy wealth. The study found that firms that generate positive value-added are more likely to be wealth creators, while those that generate negative value-added are more likely to be wealth destroyers.
The paper also highlights the importance of performance metrics in assessing firms as wealth creators or destroyers. The study found that performance metrics such as return on assets, return on equity, and earnings per share are useful indicators of a firm's ability to create or destroy wealth.
Overall, the study provides valuable insights for investors, policymakers, and corporate leaders. The findings of the study can be used to identify firms that are likely to create wealth for their shareholders and to develop strategies to improve the performance of firms that are struggling to create value.
