We study how well-incentivized boards monitor CEOs and whether such monitoring improves performance. Using unique, detailed data on boards’ information sets and decisions for a large sample of private-equitybacked firms, we find...
In this paper, we first shed light on the factors that underlie the differences between the ?shareholder wealth maximization? and the ?long-term commitment? models of corporate governance. By introducing a third type of governance...
Equity research analysts tend to cover firms about which they have favorable views. We exploit this tendency to infer analysts' preferences for corporate policies from their coverage decisions. We then use exogenous analyst...
This paper develops and tests a new theoretical explanation for why a firm conducts open-market and privately-negotiated stock repurchases. Investors may disagree with the manager about the firm?s investment projects. A repurchase...
This paper links the CEO’s concerns for the current stock price to reductions in real investment. We identify short-term concerns using the amount of stock and options scheduled to vest in a given quarter. A one standard deviation...
This paper shows that improving financial efficiency may reduce real efficiency. While the former depends on the total amount of information available, the latter depends on the relative amounts of hard and soft information....
As firms have more assets in place, more of management?s limited attention is focused on managing assets in place rather than developing new growth options. Consequently, as firms grow older, they have fewer growth options and a lower...
There are numerous studies on the effectiveness of boards that primarily focus on legal formalities, including gender diversity, board size, remuneration, board evaluation and the role of the chairman of the board. While attempting...
We present a model where firms compete for scarce managerial talent ("alpha") and managers are risk-averse. When managers cannot move across firms after being hired, employers learn about their talent, allocate them efficiently to...
Separation between CEO and Chairman of the Board is typically viewed as evidence of good corporate governance. Surprisingly, the literature has failed so far to uncover any significant relation between CEO/Chairman duality and firm...
Shareholder valuations are economically and statistically positively correlated with independent directors? power, gauged by social network power centrality. Powerful independent directors? sudden deaths reduce shareholder...
We study reputation incentives in the director labor market and find that directors with multiple directorships distribute their effort unequally according to the directorship's relative prestige. When directors experience an...