Firms with busy boards, those in which a majority of outside directors hold three or more directorships, are associated with weak corporate governance. These firms exhibit lower market-to-book ratios, weaker profitability, and lower sensitivity of CEO turnover to firm performance. Independent...

This paper examines the capital structure implications of defined benefit corporate pension plans. The magnitude of the liabilities arising from these pension plans is substantial. We show that leverage ratios for firms with pension plans are about 35% higher when pension assets and liabilities...

We examine the characteristics of firms that adopt stock-option plans for outside directors using a sample of 2,088 firm-year observations of Fortune 1000 firms from 1997-1999. Using fixed-effects models that account for self-selectivity bias, we find that firms with outside director option...

We present evidence that busy outside directors are associated with weak corporate governance based on a sample of U.S. industrial firms from 1989 to 1995. When a majority of outside directors serve on three or more boards, firms exhibit lower market-to-book ratios as well as weaker operating...

Using a sample of IPOs from 1994 to 2004, we show that newly public firms make acquisitions at a torrid pace. This acquisition activity is fueled not only through the initial IPO proceeds, but also through the creation of an acquisition currency that is used to raise capital for both cash and...

We analyze why firms use non-intermediated short-term debt by studying the commercial paper (CP) market. Using a comprehensive database of CP issuers and issuance activity, we show that firms use CP to provide start-up financing for capital investment. Firms' CP issuance activity is driven by a...

We study the relation between firms? banking relations, ownership structures, and q ratios in Japan. At low levels of equity ownership by main banks, firms? q ratios fall as bank equity ownership rises. At higher levels of bank equity ownership, this relationship is mitigated and, in some...

The leveraged buyout (LBO) boom of 2004-2007 was fueled by growth in collaterialized debt obligations (CDOs) and other forms of securitization. Banks that were active in structured credit underwriting lent more for LBOs, indicating that bank lending policies linked the LBO and CDO markets. LBO...

We investigate the reputational impact of financial fraud for outside directors based on a sample of firms facing shareholder class action lawsuits. Following a financial fraud lawsuit, outside directors do not face abnormal turnover on the board of the sued firm but experience a significant...