About 1,500 Empirical Studies Apply the BCF Entrenchment Index

This post relates to a Program on Corporate Governance study published by Lucian Bebchuk, Alma Cohen and Allen Ferrell, What Matters in Corporate Governance, available here and discussed on the Forum hereLucian Bebchuk is James Barr Ames Professor of Law, Economics, and Finance and Director of the Program on Corporate Governance, Harvard Law School. Alma Cohen is Professor of Empirical Practice, Harvard Law School. Allen Ferrell is Harvey Greenfield Professor of Securities Law, Harvard Law School.

In a study issued by the Harvard Law School Program on Corporate Governance, What Matters in Corporate Governance?, (the “BCF Study”) Bebchuk, Cohen, and Ferrell (2009) put forward a corporate governance index – the Entrenchment Index (“E-Index”). This post provides an update on the considerable influence that the BCF Study has had on subsequent research. According to Google Scholar citations data, as of the beginning of 2023, the BCF Study was cited by about 3,500 research papers (listed here). Furthermore, a review of these research papers has identified about 1,500 studies that have applied the E-Index and used it in their empirical analysis. A list of the studies using the E-Index in their empirical analysis is available here.

The list of studies applying the E-Index includes empirical studies published in:

  • Leading journals in finance such as the Journal of Finance, the Journal of Financial Economics, and the Review of Financial Studies;
  • Leading journals in economics such as the Journal of Political Economy and the Review of Economics and Statistics;
  • Leading journals in law and economics such as the Journal of Law and Economics and Journal of Law, Economics, and Organization; and
  • Leading journals in accounting, such as the Journal of Accounting and EconomicsJournal of Accounting and Public Policy, and The Accounting Review. 

The BCF Study was first circulated in 2004 and was published in 2009 in the Review of Financial Studies. The BCF Study identified six corporate governance provisions as especially important, demonstrated empirically the significance of these provisions for firm valuation, and put forward an “Entrenchment Index,” the E-Index, based on these six provisions.

The BCF Study is available here.

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