Economic value added adoption in China’s state-owned enterprises : a case of evolutionary change

Key Conclusions
The evolutionary change is achieved in Chinese state-owned enterprises by staged performance measurement system development in which Economic Value Added is introduced gradually.
• This design is driven by the inter twined motives of legitimacy and efficiency, and the need of optimum balance between stability and change.
• Some changes are obser ved, including an improved awareness of the cost of capital, a greater willingness for investing in R&D, and an improved asset and operation efficiency.
• The extent of the impact is variable among the companies and it is largely determined by the motives behind implementing EVA, and the level of management effort.