In a 2010 special report, The Economist called the resurgence of state-owned mega-enterprises, especially those in emerging economies, “Leviathan Inc,” and criticized their poor governance and low efficiency. We show that state-owned enterprises engage more in environmental issues and are more responsive to salient environmental events.
The effect is more pronounced in energy firms located in emerging economies and countries with higher energy risks, and with direct ownership held by domestic government rather than sovereign wealth funds. Market value does not suffer from such engagement. These results suggest that “Leviathan Inc.” may be better positioned at dealing with environmental externalities.
How Investors Can (and Can't) Create Social Value
Most investors have a single goal: to earn the highest financial return. These socially-neutral investors maximize their risk-adjusted returns and would not accept a lower financial return from an investment that also produced social benefits. An...Read more
The Great Pyramids of America: A Revised History of US Business Groups, Corporate Ownership and Regulation, 1930-1950
Most listed firms are freestanding in the U.S, while listed firms in other countries often belong to business groups: lasting structures in which listed firms control other listed firms. Hand-collected historical data illuminate how the present...Read more
Insider Trading, News Releases and Ownership Concentration
This paper investigates the market's reaction to UK insider transactions and analyzes whether the reaction depends on the firm's ownership. There are three major findings. First, differences in regulation between the UK and US, in particular the...Read more
Governance Under Common Ownership
Conventional wisdom is that diversification weakens governance by spreading an investor too thinly. We show that, when an investor owns multiple firms ("common ownership"), governance through both voice and exit can strengthen -- even if the...Read more
In a special report in 2010, the Economist magazine called the resurging state-owned mega-enterprises worldwide, especially those from emerging eco
This panel discussion focused on corporate governance indices.
In this paper we show that dual-class shares can be an answer to agency conflicts rather than a result of agency conflicts.
We show theoretically and empirically that executives are paid less for their own firm’s performance and more for their rivals’ performance if an i
