Financial sustainability: Difference between revisions
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Financial sustainability is achieved when an organisation is able to earn reliable financial surpluses and generate cash in the medium and longer-term. | 1. | ||
Financial sustainability - traditionally defined - is achieved when an organisation is able to earn reliable financial surpluses and generate cash in the medium and longer-term. | |||
Financial sustainability includes the ability to pay back borrowings over time, with interest, while maintaining necessary levels of internal investment. | Financial sustainability includes the ability to pay back borrowings over time, with interest, while maintaining necessary levels of internal investment. | ||
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And for the expectations for doing so in the future to be resilient to potential adverse conditions and events. | And for the expectations for doing so in the future to be resilient to potential adverse conditions and events. | ||
2. | |||
In more recent usage, financial sustainability also has a broader meaning, overlapping with ''sustainable finance.'' | |||
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* [[Cash flow]] | * [[Cash flow]] | ||
* [[Credit rating agency]] | * [[Credit rating agency]] | ||
* [[Financial]] | |||
* [[Free cash flow]] | * [[Free cash flow]] | ||
* [[Profit]] | * [[Profit]] | ||
Latest revision as of 22:51, 11 March 2023
1.
Financial sustainability - traditionally defined - is achieved when an organisation is able to earn reliable financial surpluses and generate cash in the medium and longer-term.
Financial sustainability includes the ability to pay back borrowings over time, with interest, while maintaining necessary levels of internal investment.
It is generally important both to earn consistent profits, and consistent positive cash flows.
And for the expectations for doing so in the future to be resilient to potential adverse conditions and events.
2.
In more recent usage, financial sustainability also has a broader meaning, overlapping with sustainable finance.
