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    Contemporary Issue On IFM

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    Nevin Rebeiro
    This document discusses a contemporary issue in international financial management - corporate governance. It begins by providing context that businesses now operate globally across diverse economic environments and regulations, making financial management more challenging. Corporate governance is important for multinational companies to control dispersed subsidiaries and align their goals with the parent company's goals. Good corporate governance increases a firm's value by improving earnings and reducing costs of capital, helping managers make optimal investments that benefit shareholders. Overall, corporate governance is a key contemporary issue in international financial management.

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    Contemporary Issue On IFM

    Uploaded by

    Nevin Rebeiro
    37 views2 pages
    This document discusses a contemporary issue in international financial management - corporate governance. It begins by providing context that businesses now operate globally across diverse economic environments and regulations, making financial management more challenging. Corporate governance is important for multinational companies to control dispersed subsidiaries and align their goals with the parent company's goals. Good corporate governance increases a firm's value by improving earnings and reducing costs of capital, helping managers make optimal investments that benefit shareholders. Overall, corporate governance is a key contemporary issue in international financial management.

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    Recent issue about international financial management

    Original Title

    Contemporary Issue on IFM

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    This document discusses a contemporary issue in international financial management - corporate governance. It begins by providing context that businesses now operate globally across diverse economic environments and regulations, making financial management more challenging. Corporate governance is important for multinational companies to control dispersed subsidiaries and align their goals with the parent company's goals. Good corporate governance increases a firm's value by improving earnings and reducing costs of capital, helping managers make optimal investments that benefit shareholders. Overall, corporate governance is a key contemporary issue in international financial management.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    37 views2 pages

    Contemporary Issue On IFM

    Uploaded by

    Nevin Rebeiro
    This document discusses a contemporary issue in international financial management - corporate governance. It begins by providing context that businesses now operate globally across diverse economic environments and regulations, making financial management more challenging. Corporate governance is important for multinational companies to control dispersed subsidiaries and align their goals with the parent company's goals. Good corporate governance increases a firm's value by improving earnings and reducing costs of capital, helping managers make optimal investments that benefit shareholders. Overall, corporate governance is a key contemporary issue in international financial management.

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    Assignment

    Contemporary Issue on International Financial Management

    Submitted to:
    Naharin Binte Rab
    Senior Lecturer,
    Department of Business Administration,
    East West University, Dhaka

    Submitted by:
    Nevin Rebeiro
    ID Number: 2016-2-10-241

    Submission Date:
    17th August 2019

    FIN465|SECTION 02|SUMMER 2019


    Contemporary Issue on International Financial Management
    Today the world is a global marketplace. Companies are no longer operating only
    within their national boundaries but are expanding their businesses rapidly in the international
    arena. This includes that businesses are exposed to diverse economic environment, risk
    management challenges, banking regulations, and dynamic foreign exchange rates. These
    issues make it more difficult for financial managers to manage the business internationally. To
    counter the issues financial managers takes different financial strategies which helps the
    business to sustain and fulfill its ultimate objective of maximizing shareholder wealth. A
    contemporary issue on international financial management is discussed below:

    Corporate Governance: Corporate governance is the combination of rules, processes or laws


    by which businesses are operated, regulated or controlled. The term encompasses the internal
    and external factors that affect the interests of a company’s stakeholders, including
    shareholders, customers, suppliers, government regulators and management. The board of
    directors is responsible for creating the framework for corporate governance that best aligns
    business conduct with objectives. Multinational company’s subsidiaries are dispersed in
    different geographical location. The sheer size and distance of the subsidiaries from the parent
    makes it difficult to control the subsidiaries. Thus, to avoid mismanagement of company’s
    assets and align subsidiaries goals with parent’s goals corporate governance is essential. In case
    of international financial management, a lot of emphasis is given on corporate governance to
    increase financial performance of the company.

    Corporate Governance and Value of a Firm:

    Value of Firm = Earnings/ Cost of Capital

    Corporate governance ensures proper utilization of firm’s assets. So, managers make
    investments that have high return but also ensuring the interest of the shareholder. As the
    subsidiaries practice the corporate governance appropriately the earnings of the subsidiaries
    increases. Simultaneously, corporate governance significantly reduces cost of capital by
    minimizing agency problems and systematic risk. In result, the value of firm increases by the
    help of proper corporate governance. In order to increase value of a firm corporate governance
    has become an contemporary issue on international financial management.

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