ECGI | European Corporate Governance Institute

Latest Working papers

29 October 2020

The Inside Information Regime of the MAR and the Rise of the ESG Era

The rise in ESG investing has been characterized as an “investor revolution” and a manifestation of “social change”. The current coronavirus pandemic will arguably intensify the impact of such social change, with the “S”...

Peter Muelbert | Alexander Sajnovits

Purpose

28 October 2020

Varieties of Shareholderism: Three Views of the Corporate Purpose Cathedral

This Chapter seeks to make three modest contributions by offering views of the corporate purpose cathedral that bear on the role of law in it. These views underscore the difference and the tension between an individual perspective and a...

Amir Licht

Purpose

28 October 2020

Higher Purpose, Incentives and Economic Performance

How does organizational higher purpose affect employee behavior and firm output? We develop an optimal-contracting model which shows that pursuing organizational higher purpose dissipates agency frictions, lowers wage costs and...

Anjan Thakor | Robert Quinn

Stakeholders

27 October 2020

Shifting Influences on Corporate Governance: Capital Market Completeness and Policy Channeling

Corporate governance scholarship is typically portrayed as driven by single factor models, for example, shareholder value maximization, director primacy or team production. These governance models are Copernican; one factor is...

Ronald Gilson | Curtis J. Milhaupt

Control

27 October 2020

Dynastic Control Without Ownership: Evidence from Post-War Japan

Dynastic-controlled firms are led by founding family CEOs while the family owns an insignificant share of equity (defined as less than five percent). They represent 7.4% of listed firms in post-war Japan, include well-known firms such...

Morten Bennedsen | Vikas Mehrotra | Jungwook Shim | Yupana Wiwattanakantang

CEO

25 October 2020

Managerial Trustworthiness and Buybacks

CEO trustworthiness is positively related to long-term excess returns after buyback announcements. When the CEO is trustworthy, statements that the stock is undervalued are more credible. CEO trustworthiness is initially measured...

Sterling Huang | Kaisa Snellman | Theo Vermaelen

21 October 2020

Making the Case for a Rome V Regulation on the Law Applicable to Companies

There is significant legal variation and uncertainty in the conflict of laws rules applicable to companies in the EU. While the case law of the Court of Justice on the freedom of establishment has clarified some questions, it is evident...

Carsten Gerner-Beuerle | Federico M. Mucciarelli | Edmund Schuster | Mathias Siems

Contracts

19 October 2020

Uncertainty and Contracting in Organizations

We study a multidivisional firm where headquarters are exposed to moral hazard by division managers under uncertainty (or "ambiguity") aversion. We show the aggregation and linearity results of Holmström and Milgrom (1987) hold in...

David Dicks | Paolo Fulghieri

Funds

19 October 2020

Shareholder Value(s): Index Fund ESG Activism and the New Millennial Corporate Governance

Major index fund operators have been criticized as ineffective stewards of the firms in which they are now the largest shareholders. While scholars debate whether this passivity is a serious problem, index funds’ generally docile...

Michal Barzuza | Quinn Curtis | David H. Webber

Short-termism

16 October 2020

Short-Termism, Shareholder Payouts, and Investment in the EU

Investor-driven “short-termism” is said to harm EU public firms’ ability to invest for the long term, prompting calls for the EU to better insulate managers from shareholder pressure. But the evidence offered—in the form of...

Jesse Fried | Charles Wang

ESG

29 September 2020

Corporate Social Responsibility and Sustainable Finance: A Review of the Literature

Corporate Social Responsibility (CSR) refers to the incorporation of Environmental, Social, and Governance (ESG) considerations into corporate management, financial decision making, and investors’ portfolio decisions....

Hao Liang | Luc Renneboog

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Explaining the prevalence of equity-based incentive contracts and the rarity of relative performance contracts

Index funds are locked in a contest to win the future assets of the millennial generation

Little basis for the view that short-termism in the EU warrants corporate governance reforms

Explaining the prevalence of equity-based incentive contracts and the rarity of relative performance contracts

Index funds are locked in a contest to win the future assets of the millennial generation

Little basis for the view that short-termism in the EU warrants corporate governance reforms

Explaining the prevalence of equity-based incentive contracts and the rarity of relative performance contracts

Index funds are locked in a contest to win the future assets of the millennial generation

Little basis for the view that short-termism in the EU warrants corporate governance reforms

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