In this episode of The Better Finance podcast, host Myles Corson talks to Christopher Volk, author of the book The Value Equation, about his formula for maximizing investor wealth.
Christopher Volk’s distinguished business career has included taking three companies public, two of which he founded. Leading those companies, he evolved the ideas that inform the reader that wealth creation for shareholders was a more important measurement of business success than typical earnings metrics. His approach provides a roadmap to how successful companies can create wealth through strong business models.
With this approach, there are six key variables that combine to deliver equity return. The key for the CFO is to dissect the business model, understand where the variables are and track them over time. The objective is to make the business and the equity worth more than it costs to create. The key stakeholders are customers and shareholders. If a business can deliver value for them, other stakeholders, such as employees, suppliers and communities will all benefit from the wealth created.
In a high-performing business, corporate culture is vital and strong communication should be at the heart of it. Employees should be empowered to put forward ideas and solutions and not be held back by fear of disrupting positivity.
Finally, Christopher gives us a glimpse into a quote that inspires him and looks forward to a constructive future for finance as it exploits the potential of artificial intelligence (AI).
Key takeaways:
- Shareholder wealth can be a more important measurement of business success than typical earnings metrics.
- Businesses can create wealth by wrapping customer solutions into a strong business model.
- The most successful companies are more likely to have a business and equity worth more than they cost to create.
- CFOs should focus on value for customers and shareholders and other stakeholders, including employees and the community will benefit.
- A high-performing corporate culture is likely to require open communication from the top and employees unafraid to solve problems.
For your convenience, full text transcript of this podcast is also available. Read the transcript.
Recent searches
Presenters
Myles Corson
EY Americas Markets Leader, Financial Accounting Advisory ServicesPodcast
Season 6, Episode 4
Duration 20m 17s
In this series
Series overviewWhat finance can expect with integrated CPM and reporting technologies
Season 6, Episode 3
Presenters
EY Americas Markets Leader, Financial Accounting Advisory Services
How finance is important in the age of social media and AI
Season 6, Episode 1
Presenters
EY Global and Americas Strategy and Markets Leader, Financial Accounting Advisory Services
How tax and finance are evolving to support business and talent
Season 5, Episode 8
Presenters
EY Global and Americas Strategy and Markets Leader, Financial Accounting Advisory Services
Why financial reporting rigor is vital to ESG
Season 5, Episode 7
Presenters
EY Global and Americas Strategy and Markets Leader, Financial Accounting Advisory Services
What is market short-termism’s perceived impact on ESG investments?
Season 5, Episode 6
Presenters
EY Global and Americas Strategy and Markets Leader, Financial Accounting Advisory Services
Managing Director, Environmental, Social and Governance, Ernst & Young LLP
How to maximize the cloud for finance and tax transformations
Season 5, Episode 5
Presenters
EY Global and Americas Strategy and Markets Leader, Financial Accounting Advisory Services
Think ESG: A view of the EU Taxonomy
Season 5, Episode 4
Presenters
EY Global and Americas Strategy and Markets Leader, Financial Accounting Advisory Services
Managing Director, Environmental, Social and Governance, Ernst & Young LLP
Think ESG: Finding the path to ESG-linked financial value
Season 5, Episode 3
Presenters
EY Global and Americas Strategy and Markets Leader, Financial Accounting Advisory Services
Managing Director, Environmental, Social and Governance, Ernst & Young LLP