Stock exchange listing induces sophistication of capital budgeting
By: MENDES-DA-SILVA, Wesley
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Contributor(s): SAITO, Richard Saito.
Material type: 
ArticlePublisher: São Paulo : FGV, set./out. 2014Title translated: Listagem em bolsa induz sofisticação do orçamento de capital.Online resources: Acesso Revista de Administração de Empresas - RAE 54, 5, p. 560-574Abstract: This article compares capital budgeting techniques employed in listed and unlisted companies in Brazil. We surveyed the Chief Financial Officers (CFOs) of 398 listed companies and 300 large unlisted companies, and based on 91 respondents, the results suggest that the CFOs of listed companies tend to use less simplistic methods more often, for example: NPV and CAPM, and that CFOs of unlisted companies are less likely to estimate the cost of equity, despite being large companies. These findings indicate that stock exchange listing may require greater sophistication of the capital budgeting process
This article compares capital budgeting techniques employed in listed and unlisted companies in Brazil. We surveyed the Chief Financial Officers (CFOs) of 398 listed companies and 300 large unlisted companies, and based on 91 respondents, the results suggest that the CFOs of listed companies tend to use less simplistic methods more often, for example: NPV and CAPM, and that CFOs of unlisted companies are less likely to estimate the cost of equity, despite being large companies. These findings indicate that stock exchange listing may require greater sophistication of the capital budgeting process
ISSN Online: 2178938X
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