Return on Capital Employed (ROCE)

From Private Empire: ExxonMobil and American Power by Steve Coll on the idea of ROCE as the primary financial metric at Exxon:

"This was a performance measure that sought to show how well a particular Exxon business unit - and overall, the corporation - used the cash it borrowed or recycled from earnings to reap returns from new projects.  After he took charge, Raymond campaigned on Wall Street to have his particular measure of R.O.C.E. recognized as the premiere number by which oil companies should be judged.  He argued repeatedly to analysts that oil companies were very long-term businesses that consumed a great deal of capital, and that, ultimately, they should be judged not by quarterly profits or share-price fluctuations, but by how well they managed their investments - whether, for example, they regularly destroyed capital by leasing unproductive oil fields, going over budget on huge drilling projects, or by building unprofitable refineries."

ROCE = Net operating profit after tax / Capital employed.  The numerator is EBIT less tax less non-operating items.  The denominator is commonly represented as total assets less current liabilities (or fixed assets plus working capital).