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HLS Faculty & Senior Fellows
Program on Corporate Governance Advisory Board
- Peter Atkins
- David Bell
- Kerry E. Berchem
- Richard Brand
- Daniel Burch
- Paul Choi
- Jesse Cohn
- Arthur B. Crozier
- Renata J. Ferrari
- Andrew Freedman
- Ray Garcia
- Joseph Hall
- Jason M. Halper William P. Mills
- David Millstone
- Theodore Mirvis
- Philip Richter
- Elina Tetelbaum
- Sebastian Tiller
- Marc Trevino
- Steven J. Williams
Author Archives: Harvard Law School Forum on Corporate Governance and Financial Regulation
The Long-Term Consequences of Short-Term Incentives
In our paper, The Long-Term Consequences of Short-Term Incentives, which was recently made available on SSRN, we show that short-term stock price concerns induce CEOs to take value-reducing actions. We measure short-term concerns by the amount of a CEO’s equity that is scheduled to vest in a given quarter. Vesting equity is positively associated with […]
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Posted in Academic Research, Empirical Research, Executive Compensation, Mergers & Acquisitions
Tagged Agency costs, Equity-based compensation, Executive Compensation, Executive performance, Incentives, Long-Term value, Management, Mergers & acquisitions, Repurchases, Shareholder value, Short-termism
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Improving SEC Regulations with Investor Ordering
In my forthcoming article, The Case for Investor Ordering, I show that Securities and Exchange Commission (SEC) regulations regarding corporate arrangements could be substantially improved if investors in corporations were able to choose whether those regulations apply to the corporation. For all but a few SEC regulations, such “investor ordering” would result in greater aggregate […]
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Posted in Academic Research, Comparative Corporate Governance & Regulation, Financial Regulation, Institutional Investors, Securities Regulation
Tagged Agency costs, Blockholders, Capital markets, Contracts, Cost-benefit analysis, Disclosure, Financial regulation, Institutional Investors, Ownership, Private ordering, SEC, Securities regulation, Shareholder value
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Finding Common Ground on Shareholder Proposals
The process by which shareholders are permitted to include their proposals in company proxy statements is under attack. The Business Roundtable and the Chamber of Commerce have each published reform proposals that would sharply limit these proposals. The Financial CHOICE Act, which passed the House of Representatives on a strictly partisan vote, includes provisions that […]
Click here to read the complete postDelaware’s Loss of Top Spot for Lawsuit Climate
The state of Delaware fell from the top-ranked position to number 11 in the most recent survey on the business-friendly environment for lawsuits in state courts, ceding ground to the state of South Dakota. Delaware had been in the highest perch for the last ten surveys, going back to 2002 (the surveys were not conducted every year). The […]
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Posted in Comparative Corporate Governance & Regulation, Mergers & Acquisitions, Practitioner Publications
Tagged Charter & bylaws, Delaware law, Fee-Shifting, Forum selection, Incorporations, Liability standards, Merger litigation, Securities litigation, State law, Surveys
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Are Mutual Fund Managers Paid for Investment Skill?
A substantial part of investment management is delegated to institutions such as mutual funds, pension funds, university endowments, and hedge funds. Mutual funds account for a significant part of this market. Prior research has mostly been silent on the important distinction between the fund family and the managers it employs to manage its different funds. […]
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Posted in Academic Research, Empirical Research, Institutional Investors, International Corporate Governance & Regulation
Tagged Accounting, Agency costs, Asset management, Bonuses, Fund performance, Incentives, Institutional Investors, International governance, Management, Mutual funds, Pay for performance, Sweden
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Corporate Governance: Stakeholders
In response to the recent Green Paper and the U.K. Government Response, the Institute of Chartered Secretaries and Administrators (ICSA-The Governance Institute) and the Investment Association (IA), with U.K. Government approval, have issued a paper, The Stakeholder Voice in Board Decision Making, setting forth core principles for complying with Section 172 of the U.K. Company […]
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Posted in Boards of Directors, Corporate Elections & Voting, Corporate Social Responsibility, International Corporate Governance & Regulation, Practitioner Publications
Tagged Accountability, Board composition, Board leadership, Boards of Directors, Corporate Social Responsibility, Decision-making, Director nominations, Engagement, ESG, Fiduciary duties, International governance, Long-Term value, Reputation, Stakeholders, UK
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SEC (Limited) Guidance on Pay-Ratio Disclosure
[September 21, 2017], the SEC announced that it had adopted interpretive guidance in connection with the pay-ratio disclosure requirement, which mandates public company disclosure of specified pay-ratio information, beginning with the upcoming 2018 proxy season. Generally, the guidance provides a more expansive reading of three topics: company reliance on reasonable estimates, the use of existing […]
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Posted in Accounting & Disclosure, Executive Compensation, Practitioner Publications, Securities Regulation
Tagged Compensation disclosure, Compensation ratios, Disclosure, Dodd-Frank Act, Executive Compensation, Regulation S-K, SEC, SEC rulemaking, Securities regulation
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Activism and Board Diversity
Activism at public companies can reduce board diversity, or it can increase it, depending on the circumstances. In recent years, activist hedge funds have installed dissident nominees who collectively have trailed the S&P 1500 index significantly in terms of gender and racial diversity. In contrast, institutional shareholders and asset managers are promoting board diversity to […]
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Posted in Boards of Directors, Corporate Elections & Voting, Institutional Investors, Practitioner Publications
Tagged Accountability, Asset management, BlackRock, Board composition, Board performance, Boards of Directors, Diversity, Engagement, ESG, Hedge funds, Institutional Investors, Pension funds, Shareholder activism
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Long-Term Pay-For-Performance Alignment
With the introduction of say-on-pay (SOP) in 2011 and the increased clout of proxy advisory firms on executive compensation program designs, the performance share unit (PSU) has become a common feature of executive long-term incentive (LTI) programs among U.S. public companies. PSUs at many companies have now been in place for ≥10 years, which provides […]
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Posted in Boards of Directors, Corporate Elections & Voting, Executive Compensation, Institutional Investors
Tagged Boards of Directors, Compensation committees, Executive Compensation, Incentives, Institutional Investors, Management, Proxy advisors, Say on pay, Shareholder value, TSR
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