Evaluate Unilever's financial strategy Essay Example | Topics and Well Written Essays - 1750 words

Evaluate Unilevers financial strategy - Essay ExampleThen the sources of finance is analysed using Modigliani-Miller Theorem and it reveals that the debt to equity situation of the disposal is good and has significant impact on its market value. However, the currency position of the company is not stable and requires attention from the management. The Dividend policy of the organization is lusty and looks at riches maximization of the shareholders. The managers are concerned about the dividend re disco biscuit and regularly review the dividend policies. Moreover, the economic condition is instead unstable and a sluggish product is expected. In this regards it is recommended that the organization should give attention towards their cash position and should enhance other activities through which their profitability can be enhanced. The organization is also suggested to maintain healthy debt equity ratio, having higher debt may negatively impact their firm value. Introduction The Unilever Group started their operations in 1885 but was not established until 1930 when the argumentation actually joined forces to create the well established business prior to the start of 20th century. The corporate vision of the organization aims towards helping the people in night club to look and feel good and get more out of their life. The organization aims to create a sustainable living place and a better future through their services and brands (Unilever, 2013a). The front priority for the organization is their consumers and then comes the employees, communities and the suppliers. The organization aims to fulfil their responsibilities by serving their customers and make their shareholders eventually rewarded. Financial strategy plays a major role in the sustainability of an organization. Financial strategy is a portfolio that includes corporate strategic plans that involves financing decision and optimum investment that helps in attaining the specified objectives. It is an area of managerial policies that determines the financial and investment decisions, which in turn leads to the wealth maximization of the shareholders (Hill, 2009). This paper focuses on the financial strategy of the organization and provides recommendation on the solid ground of that. Corporate Life Cycle The Corporate life cycle can be segregated into quartet branchs through which an organization passes. The four stages are introduction, growth, matured and compensate. The introduction stage is the point where the organization first places its product and services in the market for the customers. In this stage it starts capturing the market share. The next stage is the growth stage in which the organization with the best quality product or service is at the transcend of the competition. The sales increases and the organization spend money in building the brand. The demands of the consumers are at the highest point. The third stage is maturity where the organization has maximised their profit and is operating at a stable place in the market. present the organization decides whether to withdraw their product or services from the market or to bring some knowledgeableness in them such that they remain in the market. The main focus is on the sustainability of the business. The last stage is the decline stage. At this stage the organization has already introduced their new products or next generation product. The