As long-term interest rates move into the 3% range, how companies should assess their cost of capital has become a focus. Nikkei has reported on comments by IHI Senior Executive Officer Oshima Hiromi (大嶋裕美) and discussions at the board of directors.
As warnings are sounded that long-term interest rates could reach 3%, discussion is growing around the weighted average cost of capital (WACC), which is attracting attention as a measure of companies' cost of capital.
IHI Senior Executive Officer Oshima Hiromi (大嶋裕美) said that fewer people with management experience will be available in a world of higher interest rates.
As funding costs rise from the low-interest-rate era, companies may face pressure to be selective and focused in their investments.
Interest rate levels at the time of refinancing have recently become a topic of discussion at boards of directors.