Assessing the value factors of agricultural companies

Abstract

Subject. The article investigates the correlation between economic and geographical factors and the value of agricultural companies. Objectives. The purpose is to construct an econometric model of dependence of agricultural companies’ value on economic and geographical factors and interpret the obtained results, considering industry characteristics. Methods. The study employs general scientific methods of research, like generalization, analysis, synthesis, analogy, deduction and induction, as well as methods of logical, statistical, and econometric analysis. Results. Testing the regression model based on the data of more than two hundred agricultural companies, presented in the Standard&Poor's international database for 2012–2019, demonstrated a positive correlation between company's value and its size, return on assets and equity, and negative correlation between company's value and age, leverage, debt ratio, as well as its belonging to an economically developed country on its value. Conclusions. The focus on sustainable development, consumption and production changed the paradigm of business valuation: non-financial activities are treated on a par with financial performance. The transformation to ESG (Environmental, Social, and Governance) standards encourages key stakeholders to assess issues related to corporate governance, social responsibility, innovative cooperation, "sustainable" development, etc., when making strategic decisions. The scientific novelty of the study is to identify negative relation between the value of agricultural companies and their belonging to economically developed countries, which may be caused by the distrust of key stakeholders of the industry in modern, often contradictory in terms of ethics, biotechnology developments.