Performance of large companies of BRIC, USA, Japan and Germany: a comparison based on value creation

Abstract

This study aimed to answer the question: Are companies operating in developed countries able to generate more wealth than those present in emerging countries? To this end, we developed a quantitative research using statistical tools to comparatively analyze the levels of generation of economic value added (EVA – Economic Value Added) of a specific set of companies from the BRIC countries and three developed countries. Data from major public companies in each country were collected for the 2000-2010 period. The results showed that, on average, companies in both groups of countries are value adding. They also showed that U.S. companies notably create more value than companies of any of the other countries studied. Two innovative results were obtained in relation to the established literature: detection that companies from both groups of countries achieved the same level of return on invested capital; and detection that the majority of companies from the BRIC countries are value adding, which did not occur with the companies of developed countries.

Keywords:
Economic value; EVA; BRIC; Company management