New metrics for value-based management

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The majority of German DAX 30 corporations remain committed to the shareholder value concept. However, stock returns alone are inadequate for internal performance management, prompting companies to adopt Value-Based Management Systems. These systems utilize accounting-based performance measures to assess how much shareholder value management has generated over time, both overall and by business unit. The data used for these measures must be publicly available and ideally disclosed separately, enabling capital market participants to link performance results to stock prices. Various metrics such as net earnings, residual income, EVA, and REVA have been employed for performance measurement, but they exhibit methodological shortcomings and their correlation with stock performance can be significantly improved. Annette Holler's study contributes meaningfully by introducing two new metrics, CRI and CEVA, which demonstrate superior methodological and empirical results. This examination of both existing and newly developed performance measures is unprecedented, and Holler's dissertation significantly advances prior academic research in this field.