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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
Just How Iron-Clad are Contractual Rights to Payment On Preferred Stock of a Solvent Company?
Minority equity investments in public companies are on the rise. These are often structured as an investment in convertible preferred stock to give the investor a senior position to other equity while preserving equity upside through the ability to convert to common stock. This trend is likely sparked by a search for higher yield than […]
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Posted in Bankruptcy & Financial Distress, Practitioner Publications
Tagged Contracts, Covenants, Debt, Debt contracts, Delaware law, Dividends, Dual-class stock, Fiduciary duties, Leverage
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Below-the-Merger-Price Appraisal Results and the SWS Decision
In In re Appraisal of SWS Group Inc. (May 30, 2017), the Delaware Court of Chancery, relying on a discounted cash flow analysis, determined that the appraised “fair value” of SWS Group, Inc. (the “Company”) was below the merger price paid by acquiror Hilltop Holdings, Inc. The court’s determination of fair value was 7.8% below the value of the […]
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Posted in Court Cases, Mergers & Acquisitions, Practitioner Publications
Tagged Accounting, Appraisal rights, Arbitrage, Delaware cases, Delaware law, Fair values, Firm valuation, Hedge funds, Merger litigation, Mergers & acquisitions
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Is Board Compensation Excessive?
In our article, Is Board Compensation Excessive? (forthcoming in the Journal of Corporate Finance), we examine whether board members are overpaid. We also consider whether excessive compensation of directors affects their ability to monitor. We address these issues by carefully constructing a model to predict director compensation. We then identify the presence and magnitude of […]
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Posted in Academic Research, Boards of Directors, Comparative Corporate Governance & Regulation, Empirical Research, Executive Compensation
Tagged Agency costs, Board independence, Board monitoring, Board performance, Boards of Directors, Director compensation, Entrenchment, Executive Compensation, Executive turnover, Firm performance, Oversight, Pay for performance
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Déjà Vu: Model Risks in the Financial Choice Act
On June 8, 2017, the Financial Choice Act of 2017 was passed by the House of Representatives, following a CBO analysis dated May 10, 2017. But both the CBO analysis and the House bill fail to address model risks for depository institution holding companies (DIHCs) that date back to 1999 and the creation of large […]
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Posted in Accounting & Disclosure, Banking & Financial Institutions, Financial Crisis, Financial Regulation, Legislative & Regulatory Developments, Practitioner Publications, Securities Regulation
Tagged Banks, CHOICE Act, Failed banks, FDIC, Financial institutions, Financial regulation, Information asymmetries, Information environment, Recovery & resolution plans, Securities regulation, SIFIs, Systemic risk, Too big to fail
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A Modest Proposal? Treasury’s Report on Bank Regulation
The Trump Administration’s latest substantive recommendations on modifications to the U.S. financial regulatory regime strike a modest and practical tone, rather than “doing a big number” on the current state of regulation. On June 12, 2017, the Treasury Department released the first of several reports in response to President Trump’s Executive Order 13772, which called […]
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Posted in Banking & Financial Institutions, Financial Regulation, Legislative & Regulatory Developments, Practitioner Publications
Tagged Banks, Capital markets, Capital requirements, CHOICE Act, Compliance and disclosure interpretation, Donald Trump, Financial crisis, Financial institutions, Financial regulation, Liquidity, Oversight, Stress tests, Systemic risk, Treasury Department, Volcker Rule
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Treasury Department Issues Recommendations on Reforming the U.S. Financial System
On June 12, 2017, the U.S. Department of the Treasury issued recommendations for streamlining banking regulation and changing key features of the Dodd-Frank Act and other measures taken by regulators following the 2008 financial crisis. The recommendations are included in the first of a series of reports to President Trump pursuant to an Executive Order […]
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Posted in Financial Regulation, Legislative & Regulatory Developments, Practitioner Publications, Securities Regulation
Tagged Banks, Capital requirements, CFPB, CHOICE Act, Financial institutions, Financial regulation, Foreign banks, Liquidity, Mortgage lending, Securities regulation, Stress tests, Systemic risk, Treasury Department, Volcker Rule
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What Is the Business of Business?
In 1970, Milton Friedman famously argued that the only social responsibility of business was to maximize profits. These profits, if only returned to the firm’s owners (the shareholders, on whose behalf the management should rightfully act), could be put to charitable purposes as shareholders saw fit. By essentially delegating the task of collecting and disbursing […]
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Posted in Academic Research, Comparative Corporate Governance & Regulation, Corporate Social Responsibility
Tagged Agency model, Capital markets, Charitable spending, Corporate Social Responsibility, Firm performance, Market efficiency, Nonprofits, Philanthropy, Profitability, Public interest
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Weekly Roundup: June 16–June 22, 2017
What Determines Participation in Corporate Voting? Posted by Konstantinos E. Zachariadis, Queen Mary University of London, on Friday, June 16, 2017 Tags: Behavioral finance, Blockholders, Fiduciary duties, Information environment, Institutional Investors, Ownership structure, Shareholder elections, Shareholder proposals, Shareholder voting Chancery Court Suggests Rights Offerings May Limit Liability in Certain Transactions Posted by Meredith E. Kotler and Mark E. McDonald, Cleary, Gottlieb, Steen & Hamilton LLP, […]
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Posted in Weekly Roundup
Tagged Weekly Roundup
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House Approves Financial CHOICE Act
On June 8, the House of Representatives passed a revised version of the Financial CHOICE Act (the “Act,” available here) in a 233-186 vote. The Act would repeal or modify significant portions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) and addresses a wide range of other financial regulations. […]
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Posted in Banking & Financial Institutions, Financial Regulation, Legislative & Regulatory Developments, Practitioner Publications, Securities Regulation
Tagged Bank Holding Company Act, Capital markets, CFPB, CHOICE Act, Debt-equity ratio, Dodd-Frank Act, FDIC, Federal Reserve, Financial institutions, Financial regulation, FSOC, Liquidation, Securities regulation, SIFIs, Stress tests, US House, Volcker Rule
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Balancing the Tension: Current Topics in Executive Compensation
Executive compensation programs at major U.S. companies are crucial for economic success—both for the companies and the economy at large. The topic is complex and controversial, however, with criticisms aimed at the magnitude of pay packages and purported misalignment of compensation with corporate performance and shareholder returns. This contentious environment has been exacerbated by a […]
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Posted in Accounting & Disclosure, Boards of Directors, Corporate Elections & Voting, Executive Compensation, Institutional Investors, Practitioner Publications
Tagged Boards of Directors, Compensation committees, Compensation disclosure, Compensation ratios, Executive Compensation, Institutional Investors, Proxy advisors, Say on pay, Shareholder voting
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