We derive and develop a simple and intuitive model that shines fresh light on the relentless debate over whether corporate ownership converges to the Berle-Means modern corporation with high stock ownership dispersion. Our model takes into account the importance of both protective legal...

Mandatory pension contributions (MCs) are negative shocks to a firm's liquidity that can unfavorably impact its cost of capital, financing, and investment plans. We study whether firms faced with MCs use both non-cash (NEM) and cash generating earnings management (CEM) to partly offset their...

This paper focuses on global financial centres, which played a key role in the financial crisis of 2008. The trade in derivatives, despite being limited in large part to Europe and the USA, significantly influenced the global economy and the competitiveness of financial centres. This study...

In this paper we discuss the continued transition of financial markets towards trade standardization and the clearing of transactions, outlining the role of central clearing counterparties CCPs in reducing systemic and idiosyncratic risk. We contrast this with a discussion on bespoke non-cleared...

This study examines cash savings from net equity issues, net debt issues and internally generated cash flows. We observe that savings rates depend on the level of cash flows. For negative cash flows, savings rates are very low from cash flows and higher from net equity and net debt issues. For...

Legal investor protection is associated with how firms choose to issue shares. The likelihood of private placements relative to rights offerings increases with investor protection, as does the likelihood of public offerings relative to both private placements and rights offerings. These findings...

This study examines the impact of non-financial disclosure (NFD) on firms' labor investment efficiency. We analyze a broad sample of firms located across 44 countries and the period 2006–2019. Using regression analysis, the association between abnormal employment growth and environmental,...

This paper examines the impact of internal governance on a CEO's investment cycle. Extant literature defines internal governance as the mechanism by which senior executives help discipline the CEO to maximize shareholder value. Weisbach (1995) finds that a year or two before the CEO retires, the...

This paper investigates the effect of major board independence reforms on corporate investment efficiency using a large sample of firms from 30 countries. We find evidence of a significant reduction in over-investment subsequent to initiation of board reforms. This reduction is most effective...

The investment cycle literature suggests that older CEOs with short investment horizon may be myopic and as result incur agency costs as they try to extract rents by under-investing. Acharya, Myers and Rajan (2011) theorize that internal governance may mitigate the CEO horizon problem. We find...