The European Corporate Governance Institute Meets in Switzerland
The European Corporate Governance Institute (ECGI) held its Annual Members’ Meeting in Lausanne this week (27 -28 April). The event brought together international academics and practitioners in the field of corporate governance for an informal dinner which preceded the AGM and annual lecture the following day at IMD Business School.
The dinner, which took place at the Olympic Museum was attended by ECGI members, with David Frick, Member of the Executive Board Nestlé S.A., Head of Corporate Governance, Compliance and Corporate Services, providing the after-dinner speech. Over the past few years Mr. Frick has helped Nestlé develop into a leader in Corporate Governance in its home market and beyond, and he also runs the Company’s corporate compliance program.
The annual lecture, which was attended by ECGI members together with interested members of the public, was delivered by Professor Per Strömberg, SSE Centennial Professor of Finance and Private Equity Swedish House of Finance. Professor Strömberg’s lecture, entitled “Since you're so rich, you must be really smart: Talent and the Finance Wage Premium”, examined the hypothesis that the demand for skilled workers in finance has risen more than in other sectors resulting in extraordinary increases in relative pay within the sector over the last few decades.
Following the lecture, ECGI awarded two research prizes for the best papers in the Finance and Law Working Paper Series’ from the previous year.
The Finance Series prize of €5,000 is sponsored by Standard Life Investments, the global asset manager, was awarded to Professor Mariassunta Giannetti (Stockholm School of Economics) and Professor Mengxin Zhao (University of Alberta), for their paper on “Board Diversity and Firm Performance Volatility”.
Dealing with the topical issue of board diversity, this paper contributes to what seems to be an emerging alternative viewpoint, namely that diversity has also the downside of leading to less coherent decision-making if board members do not share a common perspective. The paper’s notable insight is in theory and in relating diversity to firm risk.
The Law Series prize of €5,000 is sponsored by Allen & Overy LLP, the international law firm, was awarded to Professor Ronald J. Gilson (Columbia University, Stanford University) for his paper “From Corporate Law to Corporate Governance”.
This paper, which is a contribution to the forthcoming Oxford University Press Handbook of Corporate Law and Governance, edited by Jeffery Gordon and Georg Ringe, highlights the evolution from corporate law to corporate governance which reflects “a move from a simple legal view of the corporation to one that has become increasingly complex and dynamic, responding to the increased complexity and dynamics of the capital, input and product markets that corporations inhabit”. The paper is a masterful review of 50 years of legal and finance scholarship on corporate governance, which at the same time, building on Professor Gilson’s own influential work in the area, provides a complete and thoughtful picture of what corporate governance in its various interdisciplinary dimensions is and why it matters in today’s business world.
Speaking at the ceremony, Professor Marco Becht, Executive Director, ECGI said:
"It has been another exciting year for the European Corporate Governance Institute, which is exemplified by the outstanding work of our research members, and the enthusiasm of our members to take part in this important annual event. We are looking forward to continue delivering leading research to support evidenced based policy making and institutional design around the globe".
An updated version of Per Strömberg’s paper will be made available in the coming weeks.
Ronald J. Gilson’s paper is accessible by clicking here.
Mariassunta Giannetti and Mengxin Zhao’s paper is accessible by clicking here.