The Shift in Corporate Governance: Value-Based Management
Abstract
This paper examines the transition from traditional multi-objective management to a value-based management (VBM) approach in corporate governance. It analyzes the limitations of stakeholder-oriented models and argues for the adoption of a single dominant objective—maximization of shareholder value—as a more effective framework for managerial decision-making.
The study explores the theoretical foundations of value-based management, including its roots in corporate finance, strategic management, and financial analysis. It highlights the role of value creation as an integrative criterion that aligns the interests of managers, shareholders, and other stakeholders.
The paper identifies key advantages of the value-based approach, such as improved transparency, better risk assessment, long-term orientation, and enhanced decision-making efficiency. At the same time, it discusses implementation challenges, including behavioral, technical, and organizational barriers. The findings confirm that value-based management represents a modern and effective paradigm for corporate governance in dynamic market environments.
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