This study sets out to examine the relative importance of legal and cultural institutions and personal values in directors’ discretion. We present first evidence on the way personal and institutional factors together guide public company...Read more
Understanding the role of culture in corporate governance has become a subject of growing importance. Today, no institutional analysis of corporate governance systems would be complete without considering the cultural environment in which such...Read more
Recent regulatory initiatives that attempt to encourage shareholder engagement, ensure board independence and improve the operation and transparency of corporate groups are of great interest to both academics and practitioners. These initiatives...Read more
In the spirit of Merton (1987), we find that improving the dissemination of company news increases the attention investors pay to a firm. We exploit a regulatory change, the European Union Transparency Directive, which pushed Continental European...Read more
The seemingly never ending scandals in the world of finance with their damaging effects on value and human welfare argue strongly for an addition to the current paradigm of financial economics. We summarize here our new theory of integrity that...Read more
This paper examines how governance and risk management affect risk-taking in banks. It distinguishes between good risks, which are risks that have an ex ante private reward for the bank on a stand-alone basis, and bad risks, which do not have...Read more
In the corporate finance tradition, starting with Berle and Means (1932), corporations should generally be run to maximize shareholder value. The agency view of corporate social responsibility (CSR) considers CSR an agency problem and a waste of...Read more
We study the relation between the chair of the board of directors and the CEO. We argue that substantial age dissimilarity between the two - giving rise to cognitive conflict - increases board monitoring and firm value for firms with greater...Read more
What makes a CEO? Our study combines a near-exhaustive sample of CEOs of Swedish companies with data on their cognitive and non-cognitive ability and height at age 18. On average, CEOs, particularly large-company CEOs, have much higher trait...Read more
We document firm-level changes following mergers and acquisitions (M&As) which mirror aggregate shifts in the US labor market observed in response to greater use of automation. Specifically, we show post M&A establishments become less...Read more
Expressions of dissent by corporate directors are a valuable, indeed vital, attribute of good corporate governance. Vocal opposition by a director, for example, might help correct a good-faith mistake or, in more serious and extreme circumstances...Read more
Do corporate donations enhance shareholder wealth or reflect agency problems? We address this question for a global sample of firms whereby we distinguish between charitable and political donations, as well as between donations in cash and in...Read more