SECA facilitates continuous professional development through subject-specific events and workshops, case studies, and publications, fostering knowledge exchange within the industry.
What is Corporate Finance?
Corporate finance refers to the strategic management of a corporation’s financial resources. It involves sourcing and allocating funds, determining the optimal capital structure, and making decisions that enhance long-term value for shareholders. The primary goal is to maximize corporate value while balancing risk and return.
Corporate finance encompasses a variety of activities including:
- Investment Decisions: Establishes criteria for selecting value-adding projects focusing on maximizing returns while managing risks.
- Capital Structure Optimization: Deciding how to finance those investments through a combination of equity, debt, or hybrid instruments.
- Working Capital Management: Focuses on managing a company’s short-term operational funds, including cash flow, inventory, and short-term borrowing and lending (such as the terms on credit extended to customers) to ensure sufficient liquidity for day-to-day operations.
- Financial Planning: Analyzing the company’s financial situation and planning for future financial activities, including forecasting revenues, expenses and capital requirements for investments.
- Risk Management: Identification and mitigation of financial risks that could impact the company’s performance.
The term corporate finance is often associated with investment banking advisory services:
- Initial Public Offerings (IPOs): Listing companies on a recognized stock exchange.
- Mergers & Acquisitions (M&A):
- Mergers, demergers, and takeovers.
- Sales and acquisitions of private companies.
- Management buy-outs, buy-ins, and similar transactions.
- Capital Raising: Issuing equity, debt, hybrid instruments, and related securities for refinancing and restructuring.
- Capital Repayments: Share buybacks and distributions to shareholders.
- Leveraged Finance: A bank or debt fund, providing financing to support a management buyout or a leveraged buyout (with private equity or family office backing).
Switzerland has a well-developed advisory industry in corporate finance, with market participants including investment and universal banks capable of advising and/or financing larger deals, investment banking boutiques specializing in small to mid-sized capital market transactions, but often without direct financing capabilities and advisory boutiques providing specialized transaction advisory services to mid-sized companies.
The Swiss corporate finance industry has structured itself clearly in recent years, with most key players being members of SECA.
