The Cfo and Financial Structure
Weekly Toyo Keizai, October 27, 2001
3 Pages Posted: 10 May 2005
Abstract
No responsibility is clearer than the CFO's choice of the firm's financial structure, and yet no task is so complicated, and has so little helpful advice offered by academia. In fact, a theory of optimal capital structure remains of the great unsolved problems of modern corporate finance. However, academia is on the verge of a breakthrough in this classic question. This article begins by describing the commplexity of the problem, the history of thought about it starting with the Nobel prize-winning work of Merton Miller and Franco Modigliani, recent thinking particularly by Hayne Leland, where the field is headed, and what take-aways there are for CFO's.
Keywords: CFO, financial structure, corporate finance
Suggested Citation: Suggested Citation