EuroEconomica, Vol 29, No 3 (2011)

Abstract

This paper aims at highlighting the important role of the equity capital, on the one hand in achieving enough financial results, both for the compensation of the owners as expected and for the solid development of the company and, on the other hand, in ensuring a high protection against risks, especially against the risk of bankruptcy and also against the financial risk. The study which has been conducted highlights the fact that companies that have a high equity capital fulfill more successfully the two objectives of the company’s financial management compared to those that excessively resort to loans.