Author Archives: Harvard Law School Forum on Corporate Governance and Financial Regulation

Missing Pieces Report: The 2018 Board Diversity Census of Women and Minorities on Fortune 500 Boards

Key Findings A critical need for inclusive leadership, the shifting US demographics, and investor pressure in the United States have increased the focus on diversity in the c-suite and on public company boards. As demographics and buying power in the United States become increasingly more diverse, forward-thinking boards are determining ways to gain more diversity […]

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Executive Compensation, Corporate Governance, and Say on Pay

In our monograph Executive Compensation, Corporate Governance, and Say on Pay, we provide a comprehensive summary and survey of the theoretical and empirical literature on Say on Pay. In the first part of the monograph, we study theoretically how a poor governance structure affects the level and structure of executive pay and identify conditions under […]

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Internal Forecasts and M&A

Uncertainties about the near and long-term future of companies at which boards are considering strategic alternatives will result in significant impediments to the ability of management teams to produce internal forecasts upon which boards may rely in good faith to support their duty of care when choosing a strategic alternative. Often a company considering selling […]

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The Risky Business of Investing in Chinese Tech Firms

While Washington and Beijing battle over trade, a worrisome cross-border financial link has largely escaped scrutiny: Americans now collectively own most of the public equity of China’ biggest tech companies, including Alibaba, Baidu and Weibo. This relationship is strange (imagine if the Chinese owned most of Amazon, Facebook and Google). It’s also extremely risky, at least for […]

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Posted in Academic Research, HLS Research, International Corporate Governance & Regulation, Practitioner Publications, Securities Regulation | Tagged , , , , , , , , , , , , | 1 Comment

Employee-Manager Alliances and Shareholder Returns from Acquisitions

In our recent article titled Employee-Manager Alliances and Shareholder Returns from Acquisitions, forthcoming in the Journal of Financial and Quantitative Analysis, we examine the potential for management-worker alliances when employees hold substantial voting rights due to their equity ownership, and how such alliances affect the agency relationship between managers and shareholders in the context of […]

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State Street and Corporate Culture Engagement

State Street’s letter to board members advises companies that this year they intends to focus on corporate culture as one of many key intangible value drivers. Through engagement, they have found that “few directors can adequately articulate their company’s culture or demonstrate how they assess, monitor and influence change when necessary.” When engaging with directors […]

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CEO Pay Trends Around the Globe

Since the passage of Say on Pay under the Dodd-Frank Act in July 2010, greater attention has been paid to executive compensation in an effort to bring transparency and oversight to the total compensation of executives of U.S. public companies. In 2018, the SEC expanded the Dodd-Frank Act further with Section 953(b), requiring companies to […]

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From Justice Kennedy to Justice Kavanaugh—Is a Shift in Securities Law Underway?

The change in the makeup of the Supreme Court may portend significant changes in investor rights in years to come. Which way will Kavanaugh lean on securities law? On October 6, 2018, Justice Brett M. Kavanaugh was sworn in as the newest Associate Justice of the Supreme Court, assuming the seat recently vacated by retiring […]

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Pay Ratio Disclosure at the S&P 500

A coalition of institutional investors with $3.3 trillion in assets under management and advisement identified best practices for pay ratio disclosure in a letter to S&P 500 index companies. 2018 is the first year in which publicly traded U.S. companies are required to report the ratio of pay between the CEO and the median worker. […]

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SEC Staff Letter on Administrative Services

On December 20, 2018, the staff (the “Staff”) of the Securities and Exchange Commission (“SEC”) granted conditional no-action relief to Madison Capital Funding LLC (“Madison”), an investment adviser registered with the SEC, from certain requirements under Rule 206(4)-2 (the “Custody Rule”) under the Investment Advisers Act of 1940 (the “Advisers Act”) in connection with Madison’s administrative agent services […]

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