Value Creation in Private Family Businesses: Case of the Czech Republic

Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F00216305%3A26510%2F22%3APU145173" target="_blank" >RIV/00216305:26510/22:PU145173 - isvavai.cz</a>
Result on the web
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DOI - Digital Object Identifier
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Result language
angličtina
Original language name
Value Creation in Private Family Businesses: Case of the Czech Republic
Original language description
A business creates new value when its operating revenues exceed all the costs associated with achieving results; this ability is measured by EVA. The crucial problem behind estimating EVA in privately held families lies in estimating cost of equity. We used the modified CAPM approach and calculate cost of equity based on companies’ accounting data for each industry branch. For this purpose, we used the dataset of 34,602 SMEs operating in the Czech Republic from 2012-2020. We used the results to analyze the difference between ROE and cost of equity (value creation factor) of 7,955 SMEs. A linear mixed effect model was employed to analyze the influence of business age, size, leverage, and family ownership on the value creation factor. The results show that the value creation factor does not seem to be dependent on the size of the business, however, the age of the business plays a significant role.
Czech name
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Czech description
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Project
<a href="/en/project/TL02000434" target="_blank" >TL02000434: Family businesses: Value drivers and value determination in the process of succession</a><br>
Continuities
P - Projekt vyzkumu a vyvoje financovany z verejnych zdroju (s odkazem do CEP)

Publication year
2022
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

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