On the 250th anniversary of The Wealth of Nations, this article explores how Adam Smith’s insights on ownership and incentives illuminate capitalism’s next evolution. Expanding employee ownership—without undermining shareholder governance—could reconnect productivity, responsibility, and prosperity in modern corporations. It could also be pivotal in rescuing our political democracy.
This book follows the theme of Corporate Governance Matters: A Closer Look at Organizational Choices and Their Consequences also by David Larcker and Brian Tayan. Larcker is the James Irvin Miller Professor of Accounting, Stanford Graduate School of Business. Brian Tayan is a member of the Corporate Governance Research Program at the Stanford Graduate School of Business. While Corporate Governance […]
No, this article isn’t about becoming famous though the internet, the Sisters of the Sororitas, or Famulous Eateries in Bangkok. Rather, I just spent an hour on a Webinar with GMI Ratings on their Forensic Alpha Model (FAM), designed to help investors predict stock returns using forensic-accounting and governance-related measures of issuer risk. Yes, it was […]
This October paper by Jeffrey L. Callen, Feng Chen, Yiwei Dou, and Baohua Xin shows analytically and empirically that the relation between conservatism and covenants is conditioned on the extent of information asymmetry between borrowers and lenders. (more…)
The Asian Corporate Governance Association (ACGA) released “CG Watch 2012,” their sixth joint survey on corporate governance in 11 Asian markets undertaken in collaboration with CLSA Asia-Pacific Markets since 2003. (more…)
Bartley J. Madden’s recent paper, Management’s Knowing Process and the Theory of Constraints, explores the brain’s capability for forming and re-forming neural circuits that constitute our perceptions of the “world out there.” Our “realities” are built up from specific and limited past experiences. Managers and boards would do well to be more attuned to uncovering erroneous assumptions […]
Risk Management and Corporate Governance: Interconnections in Law, Accounting and Tax by Marijn Van Daelen (Editor), Christoph Van Der Elst (Editor) After the recent financial crisis more and more pension and other funds are adjusting their portfolios for risk. This book offers a fascinating look at the juxtaposition of corporate governance and risk analysis. Bob […]
Corporate buybacks are now a daily news item. In 2007 US companies spent an astounding one trillion dollars on stock buybacks that exceeded dividends paid and accounted for two-thirds of net income that year. Since 2000 those same companies distributed three trillion dollars to shareholders through buybacks. By any measure, these amounts are staggering and […]
Andrea Romi, a doctoral candidate at the University of Arkansas’ Sam M. Walton College of Business, examined the SEC filings of 309 companies that received notice from the Environmental Protection Agency between 1996 and 2005 that they should expect to pay at least $100,000 in fines – the minimum amount required for disclosure by SEC […]