This article examines the post-financial crisis trends in the private equity industry. Although most research has followed the pre-crisis trends, we show that investors are
demanding the inclusion of more investor-favorable compensation terms in limited partnership agreements.
Our findings suggest that these new terms not only provide the
investors with more favorable management fee and profit distribution arrangements, but
also give them more control over the fund?s investment decisions. Importantly, the new
pattern also reveals the inclusion of more straightforward co-investment rights. Besides
the contractual ?improvements?, we observe that investors want to see more skin in the
game from the managers/general partners.
We are witnessing a quiet but quick transformation of corporate governance. The rise of digital technologies and social media are forcing companies to reconsider how they organize themselves and structure firm governance.
What is...Read more
The last twenty years or so have seen a sharp decline in public equity. I present a framework that explains the forces that cause the listing propensity of firms to change over time. This framework highlights the benefits and costs of a public...Read more
Credit ratings have been shown to be imperfect and sometimes biased measures of risk. Has this affected their use in unregulated settings? Using textual analysis, we measure the use of credit ratings in investment mandates of fixed income mutual...Read more
We provide an extensive analysis of the payout policy of U.S. banks during the crisis to examine potential risk-shifting and signaling motives of banks. We estimate an empirical model of bank payouts to assess the extent to which changes in...Read more