THE ROLE OF FINANCIAL MANAGEMENT IN THE SYSTEM OF BUSINESS ORGANIZATION: A STRATEGIC APPROACH TO SUSTAINABLE DEVELOPMENT

Abstract

The article explores the strategic role of financial management in entrepreneurial activity within the complex system of global competition, market volatility, and economic instability. It is substantiated that the quality and effectiveness of financial management largely determine the ability of enterprises to ensure solvency, retain financial stability, and enhance investment attractiveness, while simultaneously building strategic resilience to external shocks. The research emphasizes that in the 21st-century business environment, financial management is no longer limited to cost optimization or operational control but emerges as a multidimensional system that integrates long-term planning, risk mitigation, value creation, and stakeholder engagement.

The main objective of the study is to justify the integration of ESG (Environmental, Social, and Governance) principles into financial management as a tool to strengthen both efficiency and sustainability of entrepreneurial structures at the national level. Financial management is conceptualized as a comprehensive mechanism for managing financial flows, encompassing investment strategy, innovation financing, and responsible resource allocation. Through the analysis of financial dynamics of leading Ukrainian agricultural holdings (MHP, Kernel, Astarta) and IT service exports over 2014–2024, the study identifies three key priorities of strategic financial management: fostering long-term investments, ensuring crisis resilience, and enhancing transparency through ESG-oriented communication.

It is demonstrated that embedding ESG criteria into corporate financial strategies significantly improves investment attractiveness, reduces exposure to risks, and provides companies with durable competitive advantages in the global marketplace. Particular attention is given to the Ukrainian context, where the acceleration of ESG implementation is driven by adaptation to European sustainability reporting standards, compliance with international investor requirements, and the need to secure external capital flows.

The study concludes that strategic financial management should be regarded as a decisive instrument for sustainable development and competitiveness of national business structures. It also highlights the necessity for further research into methodological frameworks of ESG-oriented financial planning, which could support the transition of emerging economies toward sustainable growth models.