Synopsis on 10 Ways to create Shareholder’s Wealth

1) The company should work on the strategic management of the future value of the company
even though the strategies provide lesser income in the near ending quarters or financial
years,

2) Acquisitions of the good performing companies being in their early stage will improve the
company’s assets in the future,

3) Buying the assets and companies that will perform better in the future or the asset which
has future market value, performing not good in the present can be bought and the business
can be build in better way in future. This will increase the shareholder’s wealth by many
folds,

4) Even though some operational strategies provide short term benefits, the company should
oversee whether it might destruct the company’s long-term wealth,

5) The company should return the money of shareholders to them only when there is no other
way to increase their money. Till then the company should increase its revenue by investing
the shareholders money they are having. Returning the shareholder’s money when there is no
proper way to earn more from the money available, is necessary,

6) Rewarding the Managers and CEO for providing the improved value of long-term assets
will encourage them to do so in the future too. So that the Company’s net worth will increase
ultimately resulting in the increase in shareholder’s wealth,

7) Rewarding the operating unit employees will improve production,

8) Rewarding the front-line employees who interact directly with the consumers, will make
them enthusiastic,

9) The shareholders must be provided with the cashflows, balance sheet and income
statement from the firm,

10) Usually some firms will provide salary of the CEO’s and other senior executives in the
form of shares. It will usually increase the efficiency of the CEO and the senior executives.
Through this method the executives will work for the improvement of the share value which
in turn will increase company’s net worth and shareholders wealth.