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Institute for Corporate Governance + Ethics Indiana University

Governance by Persuasion, featuring Alon Brav

Posted on by ICGE

On March 10, 2022, presenter Alon Brav gave the lecture “Governance by Persuasion: Hedge fund activism and marker-based shareholder influence”. The lecture was based on a review paper coauthored with Wei Jiang and Rongchen Li in which the authors provide an updated empirical analysis as well as a comprehensive survey of the academic finance research on hedge fund activism. Alon provided a brief review of activists’ objectives, tactics, and the selection of target companies, and then focused on the current state of the literature, emphasizing how hedge fund activism impacts the target company, its shareholders, other stakeholders, and the capital market as a whole.

View the slides from this seminar.

Below you will find the Q&A from the seminar:

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Who Owns Your Data? featuring Angie Raymond and Scott Shackelford

Posted on by ICGE

On February 2, 2022 presenters Angie Raymond and Scott Shackelford, gave the seminar “Who Owns Your Data?”
Scott and Angie explored core questions of data governance focusing on comparing the United States, European Union, and several Asian nations with regards to their privacy, cybersecurity, and AI governance practices. They hi-lighted areas of convergence, and divergence, which in turn are giving rise to both public and private sector norm building efforts and are fueling a revolution in corporate data governance practices.

View the slides from this seminar.

Below you will find the Q&A from the seminar:

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Risk Perceptions, Board Networks, and Directors’ Monitoring, featuring Speaker, Michael Weisbach, and Discussant, Xiaoyun Yu

Posted on by ICGE

On January 6, 2022 presenter, Michael Weisbach, and Discussant, Xiaoyun Yu, gave the seminar “Risk Perceptions, Board Networks, and Directors’ Reporting.” Independent directors of corporate boards have monitoring and advising duties. One incentive for independent directors to monitor is regulatory penalties. However, it is challenging to pin down a causal effect of regulatory penalties on directors’ monitoring behavior because public information on board monitoring rarely exists. Relying on the unique feature of the Chinese financial market, Professor Weisbach and his coauthors show that an independent director is more likely to vote against management after observing another director in his/her board network being penalized for negligence. The effect is long-lasting and stronger for directors with similar traits and at firms prone to frauds.

View the slides from Michael’s seminar.

Below you will find the Q&A from Michael’s seminar:

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Corporate Governance: Data and Technology, featuring Professor Wei Jiang (Columbia Business School)

Posted on by Kelley School

On December 2, 2021, Columbia University Professor Wei Jiang gave a lecture on “Corporate Governance: Data and Technology.” Professor Jiang’s talk delves into the opportunities and challenges that data and technology have created for corporate governance. Data and technology change the nature of information and write new chapters for corporate governance. For example, the availability of alternative data (e.g., digital footprints) and machine learning create a new paradigm of informational asymmetry. They alter the informational advantage of insiders vs. outsiders and may exacerbate the informational asymmetry among investors due to differential capacities of information processing. The distributed ledger technology (e.g., blockchain technology) empowers shareholders and mitigates the problem of trust deficiency by preventing double voting and accounting fraud. Moreover, smart contracts expand the contracting space and mitigate moral hazard problems (e.g., excessive risk taking). However, sunspots may cause death spirals when renegotiation would be better solutions.

View the slides from Wei’s lecture

Below you will find the Q&A from Wei’s seminar:

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ESG: Do We Need It and Does It Work? featuring Professor Alex Edmans (London Business School and ECGI)

Posted on by Kelley School

On Nov. 3, London Business School Professor Alex Edmans gave the inaugural public lecture on corporate governance for the Institute for Corporate Governance (ICG) at Indiana University: “ESG: Do We Need It and Does It Work?”

Indiana University Professor Phil Cochran wrote, “Edmans recognizes that in a positive-sum (or “pie-growing”) world the returns on many ESG investments are quite difficult to quantify. However, Edmans suggests that will in the long run such investments will benefit both society and the firm.”

Richard Morrison at Competitive Enterprise Institute wrote “Edmans gets a lot of points for being reasonable, fair-minded, and data-driven” and “Edmans argues that modern firms can no longer be seen merely as following the law and not doing harm, but need to assert a reputation as solving the world’s social problems, in a disinterested way unrelated to profits.” Richard then touched on another important message of Edmans’ lecture: “Firms that try to be all ESG things to all people will likely not be a successful as ones that focus on a smaller subset of relevant and material topics” on which they have a comparative advantage.

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View the slides from Alex’s lecture.

Below you will find the Q&A from Alex’s seminar:

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