Abstract
The evaluation of a company's performance is an integral part of the management of every company, which allows determining the impact of business management decisions on the performance results, as well as the direction of the results and the decisions that need to be made to improve them. Traditionally, a company's performance is evaluated on the basis of an analysis of financial performance indicators, but it is noted that in today's dynamic business environment the timely control of the performance is crucial, thus, there is an increasing attention on non-financial performance indicators. The aim of the article is to investigate and compare the modern methods for company performance evaluation that are based on the analysis of financial and non-financial performance indicators. The research is carried out using systematic analysis of scientific literature, comparison, and aggregation methods. First of all, the article unfolds the essence of the concept of the company performance evaluation and highlights the differences between traditional and modern performance evaluation systems. Moreover, the advantages of non-financial performance indicators are compared with financial indicators. Furthermore, a classification scheme for performance evaluation methods is provided; by identifying their main advantages and disadvantages the most popular and widely used modern performance evaluation methods are overviewed: economic value added method, balanced scorecard, performance prism, performance pyramid, six-sigma model and multi-criteria company performance evaluation method. Finally, according to certain criteria, a comparative analysis of the latter methods is performed. The comparative analysis confirms that non-financial performance indicators complement financial indicators; therefore, in the process of a company's performance evaluation, modern performance evaluation methods, combining financial and non-financial performance indicators and allowing the performance to be evaluated both quantitatively and qualitatively, should be used. However, there is no single method that would be appropriate for all companies, so further work can be targeted at establishing a multi-criteria performance evaluation method that would satisfy the needs of a particular business' activity and targets for evaluation.
Highlights
Business performance evaluation is an inseparable management part of a company without which it would be difficult to define the impact of business management decisions, the direction of its activity results and the decisions that must be taken to improve the results
The directives state that the disclosure of non-financial information is a very significant step in proceeding with the sustainable global economy, where the long-term profitability is under combination with social justice and environmental protection, taking into account that the disclosure of non-financial information helps evaluating, monitoring and managing results of companies’ performance results and their impact on society (Europos..., 2014)
Following the above-mentioned research papers, it is observed that out of all performance evaluation methods that are distinguished in the classification scheme, the most popular and most widely employed are the following ones: economic value added (EVA), balanced scorecard (BSC), performance prism, performance pyramid, six sigma, and multicriteria performance measurement
Summary
Business performance evaluation is an inseparable management part of a company without which it would be difficult to define the impact of business management decisions, the direction of its activity results and the decisions that must be taken to improve the results. The directive states that, starting from 1st of January 2017, huge companies of European Union countries members (having more than 500 employees) should involve a non-financial report in their management report, where, as much as it is necessary for understanding company’s changes, performance results, status, and the impacts of its activity, the information at least regarding environmental issues, social and staffrelated issues, and the aspects regarding respect to human rights, fight against corruption and briberies must be provided This directive could be an incentive to monitor and fix the non-financial performance indicators for huge companies, and for small and middle-sized ones, since it is stated that this kind of information could increase the trust of investors and consumers
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
