Correction to: Corporate governance and employee treatment: Evidence from takeover defenses

This chapter examines the empirical literature on corporate law and governance in the United States. Four areas of the US corporate governance literature are discussed: (i) state competition to produce corporate law, (ii) independent boards, (iii) takeover defenses, and (iv) the use of corporate governance indices. The chapter concludes that these areas of research reflect varying degrees of success. The literature on state competition has been a major success. We know much more in this area as a result of empirical analysis in this area than we did on the basis of theory alone. At the other extreme is the literature on takeover defenses and the related literature that uses governance indices as measures of governance quality. Those empirical literatures are plagued by misunderstandings of how takeovers and takeover defenses work, and many results are therefore not as informative as they appear to be. In between is the literature on the impact of an independent board. Here, empiricists faced perhaps insurmountable challenges in proving causation, but nonetheless exposed informative associations.

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Female executives and corporate governance

Managerial Finance ◽

10.1108/mf-04-2016-0098 ◽

2017 ◽

Vol 43 (10) ◽

pp. 1056-1072 ◽

Cited By ~ 5

Author(s):

Emilia Vähämaa

Keyword(s):

Corporate Governance ◽

Chief Executive Officers ◽

Chief Executive ◽

Chief Financial Officers ◽

Gender Quotas ◽

Content Type ◽

Takeover Defenses ◽

Governance Practices ◽

The Board Of Directors ◽

Executive Officers

Purpose The purpose of this paper is to examine whether the gender of the top executives is associated with the strength of corporate governance mechanisms within a firm. Design/methodology/approach The paper uses panel and instrumental variable regressions on an eight-year sample of the S&P 1,500 firms. Findings The results indicate that firms with female Chief Executive Officers (CEOs) and Chief Financial Officers have higher quality governance practices. Moreover, female CEOs are documented to have the most significant influence on the governance attributes related to the board of directors and takeover defenses mechanisms. Originality/value Overall, these findings indicate that the gender of the firm’s executives may have important implications for the strength of corporate governance. The paper promotes the importance of the recent national policies in numerous countries on gender quotas at the executive level.

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Corporate governance and financial contracting: bondholder takeover defenses in poison puts

Corporate Ownership and Control ◽

10.22495/cocv7i2p1 ◽

2009 ◽

Vol 7 (2) ◽

pp. 9-20

Author(s):

Ai-Fen Cheng ◽

Tao-Hsien Dolly King

Keyword(s):

Corporate Governance ◽

Agency Theory ◽

Market Performance ◽

High Growth ◽

Equity Market ◽

Free Cash Flow ◽

Governance Mechanisms ◽

Takeover Defenses ◽

Growth Firms ◽

Asset Sale

Bondholder governance through the use of bond covenants and the interactions between shareholder and bondholder governance mechanisms has been recently highlighted in the corporate governance literature. In this paper, we study bondholder governance mechanisms through takeover-related bond covenants (i.e., poison puts), confirm with agency theory on the characteristics of firms that are more likely to use these covenants, and emphasize the importance of bondholder governance in the overall structure of corporate governance. We find that poison puts are often bundled with asset sale, payout, and financing restrictions, which is consistent with agency theory. We also find that high growth firms, large, profitable, low-leverage firms are more likely to use poison puts. In addition, our results on free cash flow, insider and institutional ownership provide support for agency explanation. Lastly, we find that poor bond market performance and good equity market performance are likely to motivate the incidence of poison put bond issuance. Volatility of interest rate and volatility of bond index returns motivate more issues of poison put debt. Finally, greater market term and default premiums promote the use of poison puts.

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