Corporate Ethics/Valuation - Philippines
The key role of a business corporation to the society offers some controversy. For some, its simply to enhance the wealth of shareholders while others stretch towards a global perspective of a purposive contribution to reducing community misery. The complex tasks under financial management and the attempt to maximize shareholder wealth is accepted as largely consistently carried along with corporate responsibility. However, it is a bold and accepted fact that achieving wealth or value maximization is not always socially desirable. Doing everything at all costs is relatively a "dangerous" sweeping statement normally taken negatively. I strongly disagree that creating value or profit should be made at all costs. Therefore, achieving maximum shareholder wealth as a key role in financial
Corporate reviews and analysis of the award recipients seem interesting to attest success. Several other situations noteworthy to cite includes: a) non-disclosure of a sales contract pullout, b) off-book guarantees, c) cost containment by non-payment of the legislated minimum wage, and d) artificial stock transaction at higher-than-usual price, are added examples of unethical practices. Sensible and ethical matters for consideration in such situation should include value provisions and adjustments to reflect the risks. Companies are evaluated by investors/shareholders based on financial stability, capital strength, profitability and asset utilization. The rosy profit forecasts and surging business growth was purposively maintained to lure more investors to accept or buy the business at a premium valuation. The company's relatively lenient credit policy and sales system eventually made receivables difficult and impossible for recovery and collection. Finance magazine - Euromoney awarded Philippine retailer - SM Prime Holdings Inc. For investors, creditors and regulators, such value adjustments is of great importance given the need to manage the risk profile. The US-based Ethics Resource Center gathered from one of its model business awardee, that success is not for the mere sound financial indicators but also on the context that companies will last, has built public trust, and secure employee and shareholder loyalty. The distinction of excellence worthy of an award highly took into joint consideration the importance of creating shareholder value and good corporate governance. As such, I strongly agree that it is necessary for financial managers to sensibly practice keen awareness and application of tasks to guard corporate social responsibility in pursuit of increased shareholder wealth. The company's share price fell considerably to the detriment of the several personal and institutional investors. The net impact is positive for shareholder value, however, it is deemed relatively unethical considering the hidden risks it fails to account.
Common topics in this essay:
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Holdings Inc,
Resource Center,
shareholder value,
corporate governance,
shareholder wealth,
value maximization,
key role,
maximum shareholder,
financial management,
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Acceptance Essays
