The Directors' Brief

The Directors' Brief

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The Directors' Brief
The Directors' Brief
What Is Return on Capital – and Why Should Leaders Care?
CPD Business Concepts

What Is Return on Capital – and Why Should Leaders Care?

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Richard Winfield
Jun 02, 2025
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The Directors' Brief
The Directors' Brief
What Is Return on Capital – and Why Should Leaders Care?
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In a world where capital is no longer cheap, Return on Capital (ROC) has become one of the most telling indicators of business performance.

So, what is it?

ROC measures how effectively a company turns its invested capital into profits.

In simple terms:

“For every pound (or dollar) we put into the business, how much value are we generating back?”

The formula:

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