We empirically investigate whether corporate governance structure is different between focused and diversified firms, and whether any differences in corporate governance are associated with the value loss from diversification. We find that, relative to focused firms, CEOs in diversified firms...

An unprecedented surge in financial innovation took place during the 1980s. One of these innovations was the creation of a family of securities designed to lower the cost of preferred stock financing by widening the availability of the dividends-received deduction (a provision of the tax code...