Natalia I. KozlovaPublished in:
Russian Journal of Entrepreneurship
– Volume 17, Number 18 (September 2016)

JEL classification: G31, G32, L21

Keywords: efficient-market hypothesis, inefficient market, Russian capital market, shareholder value maximization, value management


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Abstract:

The author presents her approach to a company's cost management with account of market and corporate expectations on the dynamic capital market and proves its applicability in the conditions of the Russian market. When making managerial decisions, this approach, unlike others, enables to take into account expert assessment of the accompanying possibilities and risks predetermined by possible states of the capital market (random walk state, pure chaotic state, coherent states), including the dynamic Russian one. The proposed approach to cost management has practical significance and may be of interest for a broad circle of business community participants – entrepreneurs, investors, managers, consultants and analysts – because it proposes methods of value creation and conservation for the company’s shareholders in the increased risk conditions. Because of its relative simplicity, logical consistency and empirical validity of the fundamental principles this approach may also be used by the scientific community for searching the possibilities to improve the theoretical grounds of corporate finances.

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