The Stern Stewart approach

Abstract

Concentrates on the best known and most model of shareholder values — developed by Stern Stewart, financial advisers — that has aroused, in equal measures, criticism and enthusiasm. Defines market value added (MVA) as equitable with shareholder wealth and answers the question ‘ How can the operator's energies be better directed to gain for the company?’, which brings in economic value added (EVA) — Stern Stewart's proprietary financial measure on economic rent. Charts, by aid of full explanation and use of figures, the use and definition of EVA and states EVA is ‘the single best measure of wealth creation’. Quantifies the contents with a final comment page using further figures for added emphasis in explanatory form.

Citation

Kippenberger, T. (1996), "The Stern Stewart approach", The Antidote, Vol. 1 No. 3, pp. 20-22. https://doi.org/10.1108/EUM0000000006321