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From ROE to Economic Profit: The Evolution of Corporate Performance Evaluation and Its Impact on Shareholder Wealth
January 21, 2024by Dr Dawkins Brown
The landscape of corporate performance evaluation has undergone significant transformations since the 1960s. Initially dominated by Return on Equity (ROE), the focus has gradually shifted towards Economic Profit (EP) as a more comprehensive measure of a company’s ability to enhance shareholder value. This evolution reflects a deeper understanding of financial metrics and their implications on...
