Value-based Management
Prof. Dr. Alexander F. Wagner, SFI Senior Chair, University of Zurich
Zurich (German), 27. September, 2019; 13:00 – 17:30
Pfaeffikon SZ (Ct. Schwyz Series, German), 18. November, 2019; 13:00 – 17:30
Geneva (English), 25. November, 2019; 13:00 – 17:30
How does a company generate shareholder value? This happens, of course, through appropriate investment and financial decisions. What sounds simple in financial theory proves to be an extremely complex undertaking in practice. Even the question of how to define value added is sometimes difficult to answer. Corporate governance and incentive systems for employees and managers also contribute to the implementation – or the failure – of value-enhancing measures. Finally, the psychology of managers and investors also plays a major role. Successful value-based management requires a holistic view of all these issues.
Current Situation
The success of companies is often measured by how fast their sales or profits grow. By contrast, economic value added is only created when the profit exceeds the cost of capital. This insight is of central importance for banks and for the entire financial sector. First, for financial institutions directly, because they need to know what returns their investors demand from them. And second, because financial institutions have an essential responsibility to help their clients generate value. For example, client advisors in the field of wealth management, but also investment bankers, can deliver their services much more effectively if they also know how and where value is created in the non-financial sector, e.g., in an industrial company.
Objective
In the first part of this Master Class, the conceptual idea of economic value added is conveyed vividly and operationally through the use of concrete practical examples. The special aspects of valuation and value-based management of financial companies will be discussed, also with regard to digitalization. Following the analysis of the areas in which the company generates or destroys value, the question arises as to how the actions of employees and managers can be geared towards increasing value. Therefore, the second part of the Master Class deals with the design of appropriate governance and particularly of incentive systems that take into account insights from modern behavioral economics. Here, as well, the practitioner lecturer will draw on plenty of experience to illustrate these concepts.
Target Audience
This Master Class is aimed at executives or candidates for management positions in the financial sector who wish to deepen their professional competences in the field of value-oriented management and behavioral corporate finance. The focus is on enabling participants to understand the core elements of value-based management and to incorporate them into their decision-making in their professional environment.
SAQ Recertification
This Master Class is an acknowledged SAQ recertification measure for the CWMA and CCoB profile and comprises four learning hours.