Effects of Globalization on the Financial Management of Enterprises (Research Paper Sample)

EFFECTS OF GLOBALIZATION ON THE FINANCIAL MANAGEMENT OF ENTERPRISES – PROPOSAL
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Effects of Globalization on the Financial Management of Enterprises – Proposal
Introduction
Financial management is a tool that encompasses crucial functions in an organisation which follows a predetermined set of principles. Such rules direct how an enterprise manages its financial resources. Financial managers guide the making of three critical decisions: investment, financial, and dividend decisions. Thus, they must ensure the financial health of the organisation by undertaking proper procurement, allocation, and control of financial resources. The financial management context that an enterprise employs in running its day to day activities defines the core of its capital structures, funding and risk control. Historically, managers applied financial management cultures based on unique orientations such as geographical and legal requirements. Today, however, financial management is changing by not only integration but also globalisation. While the former entails incorporating new principles and practices into an existing system, the latter is an aggregate concept by principle. There exist various ways in which globalisation manifest itself in the world of business today all of which entail an aggregate of the multiple business traditions and practices as well as approaches.
The globalisation of financial management takes the forms of linking and aggregating financial flows amongst various countries. The earliest known spark of financial globalisation began in the 1980s essentially creating a cross-country linkage between industrial and industrial countries. Over the past decades since the inception of globalisation, organisations have been able to expand their lines of operations. Also, most developing countries have a