-
Supported By:
Subscribe or Follow
Program on Corporate Governance Advisory Board
- Peter Atkins
- David Bell
- Kerry E. Berchem
- Richard Brand
- Daniel Burch
- Paul Choi
- Jesse Cohn
- Arthur B. Crozier Christine Davine
- Renata J. Ferrari
- Andrew Freedman
- Ray Garcia
- Byron Georgiou
- Joseph Hall
- Jason M. Halper William P. Mills
- David Millstone
- Theodore Mirvis
- Philip Richter
- Elina Tetelbaum
- Sebastian Tiller
- Marc Trevino Jonathan Watkins
- Steven J. Williams
HLS Faculty & Senior Fellows
Author Archives: Harvard Law School Forum on Corporate Governance and Financial Regulation
Why Shareholder Wealth Maximization Despite Other Objectives
The view that firms (managers) behave as if their goal is to increase shareholder wealth is the shareholder-wealth-maximization principle. While many might agree this principle governs managerial behavior, it continues to arouse intense scrutiny, adoration, and condemnation. We begin by summarizing the economic rationale behind and the welfare consequences of managers pursuing this principle. Numerous […]
Click here to read the complete post
Posted in Academic Research, Comparative Corporate Governance & Regulation, Corporate Social Responsibility
Tagged Agency costs, Compliance & ethics, Corporate Social Responsibility, Market efficiency, Shareholder primacy, Shareholder value
Comments Off on Why Shareholder Wealth Maximization Despite Other Objectives
Summary of MSCI Consultation Paper on Voting Rights and Index Inclusion
Equity indexes have evolved to fulfil multiple roles in the investment process and meet the needs of various types of investors. All institutional investors use indexes as market indicators and research tools. Asset owners employ them as policy benchmarks in their asset allocation. Active managers use them as performance benchmarks while passive investors use indexes […]
Click here to read the complete post
Posted in Boards of Directors, Comparative Corporate Governance & Regulation, Corporate Elections & Voting, Institutional Investors, Practitioner Publications
Tagged Boards of Directors, Capital structure, Dual-class stock, Equity securities, Index funds, Institutional Investors, Ownership, Shareholder rights, Shareholder voting
Comments Off on Summary of MSCI Consultation Paper on Voting Rights and Index Inclusion
How Valuable are Independent Directors? Evidence from External Distractions
In our article, How valuable are independent directors? Evidence from external distractions, which was recently accepted for publication in the Journal of Financial Economics, we provide new evidence on the value of independent directors by exploiting exogenous events that seriously distract independent directors. Agency theory predicts that independent directors are valuable (Fama and Jensen, 1983). Yet, empirical assessments […]
Click here to read the complete post
Posted in Academic Research, Boards of Directors, Empirical Research
Tagged Board dynamics, Board independence, Board performance, Boards of Directors, Director qualifications, Firm performance, Incentives
Comments Off on How Valuable are Independent Directors? Evidence from External Distractions
The Conflicted Role of Proxy Advisors
In an increasingly complicated investment and financial landscape, investors rely heavily on the services of data and analytics providers to support their investment-related decisions. Proxy voting is the process in which a vote is cast on behalf of a shareholder rather than that shareholder participating physically in a public shareholder meeting. The reliance on advisory […]
Click here to read the complete post
Posted in Boards of Directors, Corporate Elections & Voting, Institutional Investors, Practitioner Publications, Securities Regulation
Tagged Boards of Directors, Corporate Governance Reform and Transparency Act, Glass Lewis, Institutional Investors, ISS, Proxy advisors, Securities regulation, Shareholder voting, Small firms
Comments Off on The Conflicted Role of Proxy Advisors
Non-Delaware Decisions on Director Nominations
Two courts recently issued significant corporate law decisions that are meaningful for corporations outside of Delaware, whose courts handle more corporate law disputes than other states because Delaware is the corporate domicile for many corporations. The first decision, In re Xerox Corporation Consolidated Shareholder Litigation, was issued by the Supreme Court of the State of New […]
Click here to read the complete post
Posted in Boards of Directors, Court Cases, Mergers & Acquisitions, Practitioner Publications
Tagged Advanced notice, Antitakeover, Boards of Directors, Conflicts of interest, Management, Merger litigation, Mergers & acquisitions, Proxy contests, Shareholder nominations, Shareholder voting, State law, Takeover defenses, Xerox
Comments Off on Non-Delaware Decisions on Director Nominations
Cash Windfalls and Acquisitions
In my paper, Cash Windfalls and Acquisitions, forthcoming in the Journal of Financial Economics, I study the effect of large exogenous cash windfalls on a firm’s acquisition activity. The cash windfalls resulted from a German tax reform that made divestitures of equity stakes tax free. Since not all firms owned equity stakes, the tax reform […]
Click here to read the complete post
Posted in Academic Research, International Corporate Governance & Regulation, Mergers & Acquisitions
Tagged Acquisitions, Agency costs, Cash flows, EU, Europe, Germany, International governance, Mergers & acquisitions, Shareholder value, Taxation
Comments Off on Cash Windfalls and Acquisitions
Does it Pay to Pay Attention?
Standard economic models assume that investors continuously process and incorporate all available information in their financial decisions. In reality, however, individual investors have limited information processing capacity and display limited attention. Rational economic models predict that attention-constrained investors should benefit from paying attention and should pay attention up to the point where the benefits of […]
Click here to read the complete post
Posted in Academic Research, Empirical Research
Tagged Behavioral finance, Information asymmetries, Information environment, Oversight, Stock performance
Comments Off on Does it Pay to Pay Attention?
Board Performance Evaluations that Add Value
Annual board evaluations are now commonplace for both for-profit and non-profit organizations, with specific board evaluation recommendations forming a key component in nearly every major corporate governance standard, review or report internationally. Recent data on US boards from the global consulting firm Spencer Stuart shows that 98% of S&P 500 boards conduct a board evaluation […]
Click here to read the complete post
Posted in Boards of Directors, Comparative Corporate Governance & Regulation, Practitioner Publications
Tagged Board evaluation, Board performance, Boards of Directors, Firm performance, Shareholder value
Comments Off on Board Performance Evaluations that Add Value