The Way We Value Companies is Changing

Large corporations hold immense potential to address global challenges such as climate change and social inequality. By driving positive social and environmental impact, companies not only contribute to societal well-being but also enhance trust in the company and the continuity of its business model long-term. However, traditional performance benchmarks often fail to capture the full picture, focusing primarily on financial indicators such as market capitalisation, Return on Equity (RoE), or Price-to-Book ratio. Risks are typically assessed using backward-looking measures like stock return volatility.

To shift this paradigm, we asked ourselves a critical question: To what extent do large companies create and destroy value for society? The result is the AEX Futureproof Index, an integrated value analysis of 23 AEX-listed companies that accounts for not only financial performance but also social and ecological impact. Based on the work we did in our book Corporate Finance for Long-Term Value, the resulting Futureproof Index applies these formulas to some of the most pressing issues today, calculating the effects of everything from carbon emissions to the gender pay gap.  

Working with 400 corporate finance master’s students at Rotterdam School of Management at Erasmus University, a dozen MBA students from Nyenrode Business University, and a team of analysts, designers, & project managers from the consulting firm ftrprf, the final report offers hard numbers on these companies’ impact—and guidance for how to address it. It’s the new way forward for long-term sustainable investment, and we could not be more proud to share it with you. 

Price Elasticity Research

To complement our Index, we’ve provided research on the price elasticity of demand for the AEX-listed companies.