Abstract
The purpose of this research is to adjust the well-known economic value added method so that it could be applied for successful motivation of corporate top management. In such a case, this method is compared with the net present value method and the modified economic value added method to bring the top management interests into harmony with the interests of company owners, such as shareholders in a joint-stock company. The anticipated modified economic value added, like the net present value, all by itself does not provide any reliable reference point for a well-targeted motivation of a top manager for long-term corporate objectives. This problem can be resolved by making top-managers' remuneration dependent on the actually obtained modified economic value added on an annual basis as a result of implementing a specific project. In this case, top managers of the company become constructively motivated for the company business value appreciation following the requirements of shareholders.
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