Category Archives: Governance

Danske Bank Money Laundering Case Study

By | September 11, 2019

Courtesy of Lee Reiners and Joseph A. Smith Jr. This case study draws primarily—and in some instances quotes verbatim—from the “Report on the Non-Resident Portfolio at Danske Bank’s Estonian Branch” prepared for the Bank on September 19, 2018, by the law firm Bruun & Hjejle.[1] Additional details are derived from other sources, including Danske Bank… Read More »

How Does the Market React When Shareholders Lose Power?

By | July 9, 2019

Courtesy of Ali Akyol Rule 14a-8 of the Securities Exchange Act of 1934 allows shareholders to submit non-binding proposals demanding a vote on certain corporate matters at annual meetings. In theory, improving shareholder rights reduces agency costs associated with the separation of ownership and control. Shareholder proposals, thus, could reduce agency costs by increasing the… Read More »

Regulations and Brain Drain: Evidence from Wall Street Star Analysts’ Career Choices

By | November 19, 2018

Courtesy of Yuyan Guan, Congcong Li, Hai Lu, and Franco Wong Sell-side analysts from investment banks have long been suspected of issuing overly optimistic stock research in exchange for investment banking business, especially during the Internet bubble period in the late 1990s. Amongst a series of reforms from 2002 to 2003 to address the conflicts… Read More »

The Corrosive Effect of Offshore Financial Centers on Multinational Firms’ Disclosure Strategy

By | October 9, 2018

Courtesy of Walid Ben Amar, Luo He, Tiemei Li, and Michel Magnan Establishing subsidiaries in offshore financial centers (OFCs), such as the Bahamas, Bermuda, and the Cayman Islands, has become increasingly common for multinational corporations. For multinationals headquartered in the U.S., the primary (or at least ostensible) purpose of creating OFC subsidiaries is to reduce taxes.… Read More »

Carillion Plc: A Governance Case Study from the UK

By | July 18, 2018

Courtesy of Joseph A. Smith Jr. At year-end 2016, Carillion Plc (Carillion or the company) was, in the words of its annual report, “one of the UK’s leading integrated support services companies, with a substantial portfolio of Public Private Partnership projects, extensive construction capabilities and a sector-leading ability to deliver sustainable solutions.” [1] The company… Read More »