Category Archives: Corporate Governance

Good for Managers, Bad for Society? Causal Evidence on the Association Between Risk-Taking Incentives and Corporate Social Responsibility

By | April 9, 2020

Courtesy of Michael Mayberry Shareholders are increasingly interested in corporate social responsibility (CSR). However, as with nearly all corporate actions, shareholders are not the decision makers. Managers are. Therefore, shareholders must rely on compensation to incentivize managers towards the level of CSR they desire. To date, researchers know very little about how compensation incentivizes executives… Read More »

Valuing ESG: Doing Good or Sounding Good?

By | April 8, 2020

Courtesy of Bradford Cornell and Aswath Damodaran Using criteria based on environmental, social and governance (ESG) considerations has become an increasingly important aspect of investment decision making, particularly for high profile institutional investors. Investors, including some of the largest institutions, have added social responsibility criteria to their investing screens, and it was estimated that there… Read More »

Hot-Stove Effects: The Impact of CEO Past Professional Experiences on Dividend Policy

By | March 26, 2020

Courtesy of Matthew Faulkner and Luis García-Feijóo In 2019, companies such as IBM, Apple, and Disney paid shareholder dividends of approximately $6 billion, $14 billion, and $3 billion respectively. What explains the decision to pay out dividends and the amounts involved? In a recent study, we focus on the impact of CEO past professional experience… Read More »

Tax-Savvy Executives

By | March 9, 2020

Courtesy of Tom Kubick, Yijun Li, and John Robinson “Generally, the talent pool at lower levels—entry and staff levels—is still adequate, but the talent pool at the leadership level is extremely challenged. In some major markets, tax leadership jobs have stayed unfilled for up to a year because of an inability to find the skillset… Read More »

Restructuring the Personal-Public Gain Relationship: A Solution to the Battle Between Personal and Societal Interests

By | January 17, 2020

Courtesy of Kanksha Mahadevia Ghimire The United Nations Environment Programme issued a bulletin in 2013 highlighting the prevalent existence of corruption (fraud, bribery, abuses of power, etc.) in emissions trading, specifically the European Union’s Emissions Trading Scheme (EU ETS). Corruption undermines the emissions trading mechanism and weakens its chances to act as an effective incentive… Read More »

What does Corporate Social Responsibility tell us about Bank Risk?

By | December 19, 2019

Courtesy of Florian Neitzert and Matthias Petras Sustainability is one of the dominate issues of our time. In particular, public awareness about climate change has recently increased and the associated risks to society have been on the public agenda. On a political level, this culminated in the UN-Paris Climate Agreement of 2015. Since then, movements… Read More »

The Effect of Stardom on the Informativeness of a CEO’s Insider Trades

By | November 13, 2019

Courtesy of Sanjiv Sabherwal and Mohammad Uddin There are many studies on insider trading by corporate CEOs. There are also some studies that examine whether celebrity, or star CEOs, create more value for their firms and investors. However, no studies, until now, have attempted to identify whether there is a difference in the information content… Read More »

Does Board Independence Reduce Informed Short Selling Prior to Earnings Announcements? Evidence from Quasi-Natural Experiment

By | October 16, 2019

Courtesy of Suchismita Mishra, Anisur Rahman, and Arun Upadhyay In a new paper, we argue that the transparency created by independent boards prevents informed short sellers from taking advantage of nonpublic information, and thus results in a lower likelihood of surprise predictions of informed short selling prior to upcoming earnings announcements. Short sellers—those who sell… Read More »

Regulating Federal Securities Law Claims In Corporate Charters: The Dilemma Confronting Delaware

By | October 14, 2019

Courtesy of Mohsen Manesh In Sciabacucchi v. Salzberg, the Delaware Supreme Court confronts a thorny question at the intersection of state corporate law and federal securities law. Specifically, the case asks whether a Delaware corporation may include a forum selection provision in its corporate charter governing shareholder claims brought under federal securities law. But that narrow… Read More »

Can Tax Regulation Curb Excessive Executive Pay?

By | August 7, 2019

Courtesy of Tobias Bornemann, Martin Jacob, and Mariana Sailer For at least two decades, executive compensation has been widely discussed in public policy. Debates about inequality, risk-taking behavior, and excessiveness led to policy interventions – often by means of tax instruments – intending to control executive compensation. For example, back in 1993, the U.S. introduced… Read More »