Financialization directing strategy

Tord Andersson, Colin Haslam, Edward Lee and Nick Tsitsianis

Accounting forum, 2008, vol. 32, issue 4, 261-275

Abstract: This paper constructs an account of how financialization is directing strategy in the S&P 500 now that senior managers are required to both deliver value creation and respond to value absorption in an era of shareholder value. Value absorption arises out of the need to account for the market value of capital market transactions and this modifies reported corporate financials. Value creation and value absorption are directing strategy and financial arbitrage across product, factor and capital markets and between stakeholder groups as managers struggle to hold cash extraction out of sales revenue and maintain an increased share of cash distribution to shareholders.

Keywords: Financialization; Strategic arbitrage; Value creation; Value absorption; Shareholder value (search for similar items in EconPapers)
Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0155998208000525
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:accfor:v:32:y:2008:i:4:p:261-275

DOI: 10.1016/j.accfor.2008.08.001

Access Statistics for this article

Accounting forum is currently edited by Glen Lehman

More articles in Accounting forum from Elsevier
Bibliographic data for series maintained by Catherine Liu ().