We are not persuaded by the connection between rhetoric and results here. Even if these findings are true today, the indicators are too easily manipulated to continue to be of value. As we learn more about this study, we will report further. A main focus in corporate governance research is whether boards of directors and…
Tag: scholarship
Opinion | How Sexism Influenced Corporate Governance – The New York Times
Early in the 20th century, many owners of the iconic companies of the day were women. Before the 1929 stock market crash, female shareholders outnumbered male shareholders at AT&T, General Electric and the Pennsylvania Railroad (even though the men owned more shares). But men had little respect for women’s ability to exercise their rights as…
Do Hedge Funds Create Value? 3 Lessons From Danone And Unilever
Hedge funds do not have to disclose to the SEC any intentions to exert control of a company if they own less than 5% of a company. These small stakes can still have huge impact, as we have seen at corporate giants like Exxon and Nestle. Even small hedge funds can have significant influence if…
Corporate Directors Don’t See Stopping Wayward CEOs As Their Job – Texas A&M Today
A new study based on interviews with corporate directors from Steven Boivie, Michael C. Withers, Scott D. Graffin, Kevin G. Corley shows that they do not think their job is not oversight of management but support. In our view, the only way to fix this is to implement proxy access and majority vote requirements so directors have a…
Are Enhanced Index Funds Enhanced?
Edwin J. Elton (NYU), Martin J. Gruber (NYU), and Andre B. de Souza (St. John’s University) have a new study about “enhanced” index funds. Of course the whole idea of index funds is that they involve no enhancements at all; they just track an index like the S&P 500. But “enhancements” have become increasingly popular…
NYU Stern’s free “ESG study” database – ESG Professionals Network
NYU’s immeasurably comprehensive and instantly indispensable database includes 1400 ESG-related studies and provides the following vital conclusions: Time Matters – Improved financial performance due to ESG becomes more noticeable over longer time horizons. Investment Strategy Beats Negative Screening – ESG integration as an investment strategy performs better than negative screening approaches. Downside Protection – ESG…
Approach Hyperbolic Claims About the New Corporate Governance Data with Skepticism
The authors of this new corporate governance data set, Jens Frankenreiter, Cathy Hwang, Yaron Nili, and Eric L. Talley, should not be blamed for the hyperbolic claims. The University of Virginia’s story about it is. Their headline: Why Everything We Thought We Knew About Corporate Governance Is Wrong. The paper is titled more modestly and…
Guest Post from Jim McRitchie: The Giant Shadow of Corporate Gadflies
We are very grateful to Jim McRitchie for allowing us to share his excellent blog post responding to an academic paper on individuals like Jim who file shareholder proposals. We hope the authors will talk to Jim and some of the other “gadflies” before they do their next update. The Giant Shadow of Corporate Gadflies…
Paper: ESG Shareholder Engagement and Downside Risk
A new paper from Andreas G.F. Hoepner, Ioannis Oikonomou, Zacharias Sautner, Laura T. Starks, and Xiao Y. Zhou asks “whether engagement on environmental, social and governance (ESG) issues can benefit shareholders by reducing firms’ downside risk, measured using the lower partial moment and value at risk. Using a proprietary database, we provide evidence supporting this hypothesis….
Should a Pension Fund Try to Change the World?
In a new case study, Harvard Business School professors Rebecca Henderson and George Serafeim discuss the efforts of Hiro Mizuno, CIO of GPIF, the Japanese Government Pension Investment Fund, one of the largest pools of capital in the world, to integrate Environmental, Social and Governance (ESG) issues into every aspect of GPIF’s portfolio. Mizuno believed the only way to…
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