BUSINESS VALUE AS A MANDATORY INDICATOR OF ENTERPRISE PERFORMANCE IN THE CONTEXT OF IMPLEMENTING THE ESG AGENDA

Abstract

The purpose of this study is defined as a justification of the need, assessment methods, and the possibility of using the business value assessment indicator as an indicator of the enterprise's performance in the context of the ESG agenda. Sustainable development management should be based on environmental, social and management indicators; they are defined, but there is not a single financial indicator of the enterprise's performance among them. However, business is formed and developed on the basis of economic and financial motivation. As a result of the study of scientific publications, it was revealed that many enterprises formally comply with the requirements of sustainable development, in fact, they define the profitability of the enterprise as a general goal, and the discussion of sustainable development is reduced to the study of sustainable financing issues. The authors propose to use the business value indicator as a general integral indicator of the enterprise's performance in the context of the ESG agenda. Over the past thirty years, the science of valuation has been formed in our country, the main theoretical provisions, methodology and assessment procedures have been defined. But the implementation of the ESG agenda requires clarification and the possibility of the methods used and the possibility of assessing the differentiated structural components of the activity (results of environmental, social and management activities). The authors identified problems in implementing the business valuation procedure in the context of the ESG agenda: difficulties in assessing the business value by functional components and for individual business units, short-term forecasts, approximate assessment results and the lack of special sections in the theory and practice of risk assessment for types of activities. According to the authors, these problems can be solved by improving the economic financial accounting system based on digitalization and the use of software products, more active use of the income approach, and the development of the theory and practice of risks.