In Woke Capital Revisited, a symposium piece connected with the 2022 Berle Conference, I argue that an expanded definition of corporate purpose and the social expectation of how public companies should act have created an environment where corporations now play an increasingly prominent role in diversifying leadership. However, the scope of how widely inclusive corporate… Read More »
Several decades ago, the idea of corporate social responsibility (“CSR”) was not entirely acceptedby most corporations or legal scholars. Most scholars today, and many corporations, understand that corporations owe special commitments to their stakeholders in addition to their traditional function of maximizing profits for the benefit of their shareholders. It is also accepted that corporations’… Read More »
There is an urgent need to mobilize global capital for climate action, particularly in emerging markets. Songwe, Stern, and Bhattacharya (2022) estimate that developing countries, excluding China, will need to spend approximately $1 trillion per year by 2025 and around $2.4 trillion per year by 2030 on sustainability and transition-related investments. To meet China’s carbon… Read More »
Since 2007, a novel debt type, green bonds, has emerged as a popular instrument to raise and direct capital toward projects that curb climate change risk. Corporations, government agencies, supranational entities, and municipalities issue these bonds mainly in the US, China, and Europe. Annual green bond issuance has experienced exponential growth from $37.1 in 2014… Read More »
Over the last decade, there has been a significant increase in the popularity of socially responsible investment (SRI) funds. These funds claim to incorporate environmental and social (E&S) risks into the selection of their portfolio firms and the majority of these funds also claim that they engage with their portfolio firms to improve the real-world… Read More »
Few major deals happen without the engagement and advice of investment bankers. Whether a company is undertaking an initial public offering (IPO) or engaging in a large merger or acquisition deal, investment bankers play a critical role in advising corporate executives. Bankers routinely cultivate and build close advisory relationships with executives in the hopes that… Read More »
With growing attention on corporate social responsibility (CSR) or the more recent expression of environmental, social, and governance (ESG), many countries and regions have imposed strict mandatory rules on CSR disclosures to better serve investors and other stakeholders. At the same time, government incentive programs such as the Paycheck Protection Program (PPP) were also effective… Read More »
Reputational damage resulting from media, consumer, or investor outcry often follows corporate scandals. For instance, notable oil spills, from Exxon’s 1989 Exxon Valdez disaster to BP’s 2010 Deepwater Horizon disaster, have resulted in both hundreds of millions of dollars in direct regulatory penalties as well as short-term stock market losses (Länsilahti 2012), substantial longer-term losses… Read More »
In a new paper, I examine changes in CEO labor market outcomes following corporate environmental misconduct, which creates negative externalities that firms are required by law to prevent. Corporate activities create significant negative environmental externalities. These economic costs can exceed $4.7 trillion a year, are multi-sectoral, and appear through the entire lifecycle of products. Externalities… Read More »
Over decades, scholars across disciplines have proposed and discussed myriad “objectives” of the firm—shareholder value maximization, stakeholder theory, long-term firm value maximization, shareholder welfare maximization, and shareholder wealth maximization with stakeholder interests. One extreme is shareholder primacy, and the other is stakeholder capitalism (or conscious capitalism). The latter advocates corporate social responsibility (CSR) and has… Read More »
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