The Risk of Bankruptcy and the Effectiveness of Value Creation of the Construction Sector Enterprises in Poland

Andrzej Jaki () and Wojciech Ćwięk ()
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Andrzej Jaki: Cracow University of Economics
Wojciech Ćwięk: Cracow University of Economics

World of Real Estate Journal (Swiat Nieruchomosci), 2016, issue 98, 5-14

Abstract: The maximisation of market value is the basic financial goal of the enterprise. Separation of ownership and management and domination of ownership structures of enterprises by institutional investors have also revealed the need for the search for new concepts of management which in the existing internal and external conditions would favour the growth of the effectiveness of enterprise value creation owing to the proper integration of the goals of owners and managers. The result is the concept of value based management which has also contributed to the development of enterprise effectiveness measures, enriching them with market measures. Nearly 30-year experiences related to the value based management concept have also shown that its improper use may be the source of numerous threats which may also result in the occurrence of the risk of enterprise bankruptcy, and thus the risk for the enterprise that it will not be able to implement its immanent goal which is survival and the continuation of activities. It proves the purposefulness of conducting an analysis of enterprise value creation in connection with an analysis of the risk of its bankruptcy, based on the use of discriminant models. The paper is based on the analysis of the literature and the use of financial analysis tools in the form of effectiveness measures and discriminant models in relation to selected companies of the construction sector in Poland.

Keywords: risk of bankruptcy; effectiveness of value creation; value drivers (search for similar items in EconPapers)
JEL-codes: G32 G33 (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:kra:journl:y:2016:i:98:p:5-14

DOI: 10.14659/worej.2016.98.01

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