Monthly Archives: March 2026

How Do Corporate Managers Invest in AI and Green Technologies Based on Market Feedback?

Posted by Jie He (University of Georgia), on
Thursday, March 26, 2026
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Jie (Jack) He is a Professor of Finance at the University of Georgia. This post is based on a recent paper by Professor He, Sean Cao, Associate Professor of Accounting at the University of Maryland, Itay Goldstein, Professor of Finance at the University of Pennsylvania, and Yabo Zhao, Assistant Professor of Finance at the Chinese University of Hong Kong, Shenzhen.

The emergence of new technologies confronts firms with difficult decisions on resource allocation. Contemplating investments in these emerging technologies, firm managers have to assess the opportunities in a constantly changing environment without past records to learn from and with limited models of the costs and benefits involved. In recent years, we have seen two such emerging technologies – artificial intelligence (AI) and green (i.e., climate/environment-related) technologies – rising to huge prominence and increasingly capturing the attention of firm managers. How do they decide whether and how to invest in these technologies? What sources of information do they rely on for such decisions? Having better answers to these questions is crucial not only for understanding firms’ investment behaviors but also for understanding modern societies’ technological transformation more broadly. After all, the collective decisions of different firms determine the extent of emerging technology investment and the scope of economic transformation that could follow.

In this paper, we look at a prominent source of information – the stock market – and investigate how it has been used in the process of emerging technology investment. Financial markets have been found to be a powerful source of information: They aggregate the opinions of a diverse body of investors, are forward-looking, and respond rapidly to announcements and economic developments. A growing strand of literature has argued and shown that informational feedback from the financial markets can help guide the decision-making of corporate managers (see, e.g., Bond, Edmans, and Goldstein (2012) and Goldstein (2023)). Building on these insights, we examine how firms use information from the stock market when deciding on their investments in AI and green technologies. READ MORE »

Will the Iran War Become the Poison Pill for Proxy Contests This Season?

Posted by Kai Liekefett and Derek Zaba, Sidley Austin LLP, on
Thursday, March 26, 2026
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Kai H.E. Liekefett and Derek Zaba are Partners at Sidley Austin LLP. This post is based on their Sidley memorandum.

Brief teaser: Geopolitical shocks directly alter the risk calculus for shareholder activists. This Update lays out factors at play in activists’ decisions as proxy season meets the Iran conflict, whether activism is likely to decline, and approaches companies should take.

Escalating hostilities in the Middle East have injected a new layer of geopolitical risk into already fragile capital markets. The effects of oil price volatility, supply chain disruption, cyberthreats, and heightened regulatory scrutiny are rippling across industries. As with tariffs last year, geopolitical shocks do not affect only a company’s operating performance; they also directly alter the risk calculus for shareholder activists. While the ultimate geopolitical trajectory remains uncertain, the immediate question for Corporate America is more tactical: Will the Iran war chill proxy contests this season?

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Proxy Voting Outlook: Spotlight Turns to Governance in Transition Year

Posted by Bob Herr, Landon Shea, and Cole Moore, AllianceBernstein, on
Wednesday, March 25, 2026
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Bob Herr is a Senior Vice President and Director of Corporate Governance, Landon Shea is an Investment Stewardship Associate, and Cole Moore is an Investment Stewardship Analyst and Engagement Lead at AllianceBernstein. This post is based on their AllianceBernstein memorandum.

What you need to know

The agenda is being reset for US shareholder meetings in 2026. Regulatory shifts have led to a steep decline in overall shareholder proposals while governance issues are becoming the biggest battleground. As companies gain new power to block shareholder proposals, investors may turn to other routes to make their voices heard. Research-driven independence and a focus on governance fundamentals can guide investors through a changing environment.

–36%
decline in total shareholder proposals for S&P 1500 companies in 2025
41%
rate of support for shareholder proposals on governance issues in 2025
14%
rate of support for shareholder proposals on environmental and social issues in 2025
Bob Herr | Director of Corporate Governance

Change is in the air as the 2026 US proxy voting season begins. Regulatory shifts and new voting dynamics will challenge investment firms to remain principled in their approach to stewardship.

The proxy pendulum is swinging. After several years in which environmental and social issues gained prominence, governance matters such as director elections and executive compensation have reentered the spotlight.

This year, ballots will be cast amid significant regulatory and legal moves. Proxy advisory firms are under intense scrutiny while state and federal laws and enforcement actions have added layers of complexity to governance decision making. We believe investment firms should enter proxy season with eyes wide open: aware of what’s changing yet guided by a materiality-based framework to vote independently with conviction.

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From Iran to Taylor Swift: Informed Trading in Prediction Markets

Posted by Joshua Mitts (Columbia University) and Moran Ofir (University of Haifa), on
Wednesday, March 25, 2026
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Joshua Mitts is David J. Greenwald Professor of Law at Columbia University and Moran Ofir is a Professor of Law and Finance at the University of Haifa. This post is based on their recent paper.

The New Frontier of Insider Trading

In the hours before the February 28, 2026 U.S.-Israeli strike on Iran—one of the most closely guarded military operations in recent history—six newly created Polymarket wallets collectively earned approximately $1.2 million by purchasing ‘Yes’ shares in the ‘US strikes Iran by February 28?’ contract at prices as low as $0.10. One account, operating under the handle ‘Magamyman,’ placed its first trade seventy-one minutes before the news broke, when markets implied only a 17% probability of a strike. When those markets resolved in the affirmative, the account’s profits totalled approximately $553,000.

This episode is striking because it is hardly the first time this has occurred. Two months earlier, a pseudonymous Polymarket account called ‘Burdensome-Mix’ earned roughly $485,000 from a $38,500 investment in contracts tied to the capture of Venezuelan President Nicolás Maduro—placing its largest trades just hours before a covert military operation was publicly announced. Israeli authorities separately indicted a civilian and an IDF reservist for allegedly using classified wartime information to profit on Polymarket. A trader earned over $1 million by predicting with uncanny precision the results of Google’s proprietary Year in Search rankings. Another appeared to have advance knowledge of OpenAI’s browser launch. And a user named ‘romanticpaul’ purchased Taylor Swift engagement contracts aggressively in the days before Swift publicly announced her engagement to Travis Kelce.

These cases are not merely colorful anecdotes. They represent a systematic challenge to the legal and regulatory frameworks that govern the use of inside information in connection with trading in traditional instruments like stocks, bonds and futures. Our paper, From Iran to Taylor Swift: Informed Trading in Prediction Markets, presents the first systematic empirical and legal study of this phenomenon.

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No Loopholes for AI: Putting Legal Guardrails on Your Company’s Use of AI

Posted by Don L. Vieira and Nicola Kerr-Shaw, Skadden, Arps, Slate, Meagher & Flom LLP, on
Wednesday, March 25, 2026
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Don L. Vieira is a Partner and Nicola Kerr-Shaw is a Counsel at Skadden, Arps, Slate, Meagher & Flom LLP. This post is based on their Skadden memorandum.

Key Points

  • While no comprehensive AI regulatory framework has been enacted in the U.S., the use of AI is governed by many existing laws, with new laws coming into force across the U.S. In their oversight roles, boards need to be aware of the spectrum of laws that may govern their companies.
  • Existing laws and their application to companies need to be re-examined in light of AI advances, and new laws will need to be assessed against a business’s AI needs and ambitions.
  • With the rapid and prolific expansion of AI, companies need to implement agile and strategic compliance frameworks to keep pace with the business, and allow valuable and limited legal resources to be focused on those AI tools presenting the highest risk.

As board members, you’ve likely heard conflicting messages about artificial intelligence (AI) regulation in the U.S. Some claim that AI is simply not regulated in the U.S. The truth is more nuanced, and more immediately important, than you might think.

While it’s true Congress hasn’t passed sweeping AI-specific legislation, your company’s use of AI is almost certainly regulated already. Here’s why: The law doesn’t care how you break the rules, only that you broke them.

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How Law Firms Can Lead the Agentic AI Era — And What Clients Now Expect

Posted by Sabastian Niles, Salesforce, on
Tuesday, March 24, 2026
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Sabastian Niles is the President and Chief Legal Officer of Salesforce. This post is based on his Salesforce open letter.

Law is a noble profession, and it’s a business. Today, AI is no longer a future capability — it’s the enabler and catalyst for a fundamental shift in how law and professional services firms create value, drive top-line growth, manage risks, and earn client trust. Best-in-class legal advisory and execution has always lived at the intersection of professional duty and commercial realities. As we enter this new era, the immense value firms will unlock through agentic transformation should translate into better outcomes, deeper insights, and superior service for clients, resulting in growth for the firm. The gains must also of course be shared with clients through savings, cost-efficiencies, and new business models; with associates and partners through expanded fluency, capacity, and development; and with communities through expanded pro bono impact, strengthening the profession’s public standing.

We must be candid: Companies have become more sophisticated in how they purchase — and evaluate — legal services than ever before. While many law firms continue to rely on traditional models, we’re watching Clayton Christensen’s “The Innovator’s Dilemma” play out in real-time within the legal sector, just as it is for the broader professional service firm industry. Firms that embrace transformation are responding to this new era with digital sophistication, competing on outcomes and setting a new global standard. Meanwhile, professional service advisory firms worldwide have set their sights on legal services as ripe for reimagination. The era of the AI pilot is over. Heightened effectiveness and efficiency gains from AI, shared with clients, are no longer optional nice-to-haves; they’re prerequisites for staying competitive and seizing revenue opportunities. The gap is widening, and the time to bridge it is now.

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Five Key Considerations for Proxy Season

Posted by Richard Blake and Tamara Brightwell, Wilson Sonsini Goodrich & Rosati, on
Tuesday, March 24, 2026
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Richard Blake and Tamara Brightwell are Partners at Wilson Sonsini Goodrich & Rosati. This post is based on a Wilson Sonsini memorandum by Mr. Blake, Ms. Brightwell, Doug Schnell, David Thomas, and Amanda Urquiza.

With the 2026 proxy season upon us, companies are finalizing annual meeting materials against a backdrop of shifting investor priorities, evolving engagement dynamics, and regulatory uncertainty. This alert highlights governance, disclosure, and engagement considerations for companies preparing for their 2026 annual meetings. [1] Below are five key considerations as you finalize preparations.

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Global Trends in Women’s Corporate Leadership 2026

Posted by Subodh Mishra, ISS STOXX, on
Monday, March 23, 2026
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Subodh Mishra is the Global Head of Communications at ISS STOXX. This post is based on an ISS-Corporate memorandum by Jun Frank, Head of Compensation & Governance Advisory at ISS-Corporate.

As we mark International Women’s Day, ISS‑Corporate takes a look at trends in women’s board representation globally among major corporations, examining how representation levels and leadership roles vary across key markets. The latest data using Governance QualityScore reveal substantial regional differences, with some markets demonstrating high female board representation while others continue to trail global averages. These patterns provide important context for understanding how regulatory environments, market expectations, and governance practices shape board composition worldwide.

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Targeted Corporate Philanthropy

Posted by Cara Vansteenkiste (University of Sydney), on
Monday, March 23, 2026
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Cara Vansteenkiste is an Assistant Professor in Finance at the University of Sydney. This post is based on her recent article, forthcoming in the Journal of Finance.

Charitable giving by U.S. corporations nearly tripled over the past two decades, increasing from $13 billion in 2003 to more than $40 billion in 2024. Philanthropy has become a central part of how large firms present themselves to stakeholders and communities. Yet we still know relatively little about whether, and how, firms deploy charitable resources strategically in major corporate decisions in which external stakeholders can directly impact performance, such as mergers and acquisitions (M&As).

​Targeted philanthropy around M&A deals

​In a forthcoming article in the Journal of Finance, “Targeted Philanthropy: Evidence from M&As,” I examine whether acquirers use charitable foundation funds to influence key stakeholders in takeover transactions. I study almost one million donations made by U.S. public acquirers in 6,067 M&A deals to examine acquirers’ donation patterns to counties in which targets operate establishments or in which target insiders are active in local nonprofits. I show that acquirers’ donations to target counties increase by 19% more in the two years preceding a deal announcement, compared to pseudo target counties matched on public status, headquarter (HQ) state, industry, and size. At the deal level, more than 1/5th of M&A deals by foundation-owning acquirers involves pre-announcement donations to target charities. On average, these donations amount to more than $1 million per deal, a level 40% higher than donations to pseudo target charities.

​This expansion in targeted philanthropy reflects a reallocation of funds away from counties that are less operationally important – especially distant counties without target operations, target-affiliated nonprofits, or acquirer establishments – and redirect those funds toward counties where the target is headquartered, runs major facilities, or where target insiders are active in local nonprofits. Exploiting the fact that not all takeover offers succeed, I document that acquirers reduce donations to target counties after withdrawing a takeover offer, even when considering arguably exogenous withdrawals following lost takeover contests and market crashes.

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Global Corporate Governance Trends for 2026

Posted by Richard Fields, Rusty O’Kelley, and Melissa Martin, Russell Reynolds Associates, on
Monday, March 23, 2026
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Rich Fields leads the Board Effectiveness Practice, Melissa Martin is a member of the Board Effectiveness Practice, and Rusty O’Kelley is a Managing Director at Russell Reynolds Associates. This post is based on a Russell Reynolds memorandum by Mr. Fields, Ms. Martin, Mr. O’Kelley, Jens-Thomas Pietralla, Marc Sanglé-Ferrière, and Amy Sampson.

Converging forces of economic volatility, technological disruption, and geopolitical realignment are putting significant pressure on companies, their executives, and their non-executive leaders.

To help demystify a complicated landscape, RRA combines the expertise and experience of its leadership advisors with detailed, confidential discussions with leading governance experts each year to help organizations stay at or ahead of critical trends. With many thanks to those thought leaders, hailing from across 17 geographies, we are pleased to share the eleventh edition of Russell Reynolds Associates’ Global Corporate Governance Trends.

Corporate governance is inherently local; shaped by divergent legal, regulatory, and other requirements and norms. However, we identified five trends that cut across borders and will affect board agendas and discussions in 2026.

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