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Igor' Shevchenko1, Ekaterina Puchkina2, Nikolaj Tolstov2
  • 1 Federal State-funded Educational Institution of the Higher Education Kuban State University, 149, Stavropolskaya st., Krasnodar, 350040, Russian Federation
  • 2 Federal State-funded Educational Institution of the Higher Education Kuban State University, 149, Stavropolskaya st., Krasnodar, 350040, Russian Federation

Shareholders’ and Managers’ Interests: Collisions in Russian Corporations

2019. Vol. 23. No. 1. P. 118–142 [issue contents]

The article deals with the problem of inconsistency in the interests of owners and hired managers of corporations, manifested in management decisions that can weaken the business model of a corporation and cause direct damage to its financial condition. As a tool to prevent agency conflicts, a new method is proposed for evaluating the quality of the financial management of a corporation, which is based on a systematic approach to evaluating corporation’s financial results.

The analysis of Western financial management models showed that in the Russian econo­my, the separate use of EVA, TSR, SVA, CVA, MVA and other models based on a limited set of information doesn’t reflect the effectiveness of financial management and leaves the top mana­gers the ability to manipulate these indicators. So a method is proposed that makes it possible to identify the weaknesses of the corporate business model caused by ineffective management and minimize the negative effects of agency conflicts in the future.

The main difference of the proposed method from common models is a systematic approach to company’s financial activities, allowing to form an assessment that reflects the interests of owners in full. Besides the use of three information bases makes it impractical to manipulate separate indicators.

The method was tested on five large oil and gas Russian companies. The results allow us to recommend it for use not only in the oil and gas industry, but also in other industries that have a high share of the presence of public corporations.
Citation: Shevchenko I., Puchkina E., Tolstov N. (2019) Aktsionery i menedzhery: konflikt interesov v rossiyskikh korporatsiyakh [Shareholders’ and Managers’ Interests: Collisions in Russian Corporations]. HSE Economic Journal , vol. 23, no 1, pp. 118-142 (in Russian)
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