A Research On The Correlation Between Non-Financial Value Drivers And Enterprises' Value

The driving indicators of enterprises' value can be further divided into financial value drivers and non-financial value drivers.Financial value drivers have some tremendous strengths,such as well-understood,attaining data easily,and being observed simply.Therefore,financial value drivers are dominant in both enterprise internal management,like performance evaluation systems,and disclosure management to external stakeholders However,financial value drivers are based on accounting data,which is a reflection of historical economic events.Considering the measurement attributes are mostly based on historical costs,financial value drivers are called as lagging indicators.Effective enterprise value management practice requires timely and detailed process information to identify sources of internal deficiencies and monitor the consequences of subsequent improvement activities,which typically is not available from financial indexes.Non-financial indexes are desperately needed.Research shows positive associations between perceived environmental uncertainty and the demand for broad-based information systems incorporating non-financial drivers.The purpose of this paper is to solve the following three questions Are non-financial drivers value-related?Are they incremental to financial drivers?Are they leading indicators as the theory thinks?This paper is based on enterprise value theory,decision-usefulness view,balanced scorecard theory and a large number of existing researches.Firstly,by theory,this paper establishes the enterprise value promotion system from three key aspects,and introduces the intrinsic driving logic of non-financial drivers.Secondly,with the non-financial information of listed companies from 2014-2017 publicly disclosed,this paper chooses some non-financial indexes from three aspects—innovation,employee and market to do empirical analysis of the correlation between the non-financial value drivers and enterprises' value Lastly,this paper makes some conclusions and suggestionsAccording to the empirical results,the main conclusions are as follows.Firstly,the non-financial value drivers of three specific aspects are related to the enterprises' value.Secondly,they are incremental to financial drivers.At last,they are leading indicators.