Compensation clawback policies and corporate lawsuits

2019 ◽  
Vol 27 (1) ◽  
pp. 70-85
Author(s):  
Matteo P. Arena ◽  
Nga Q. Nguyen
Keyword(s):  
Design Methodology ◽  
Fiduciary Duty ◽  
Litigation Risk ◽  
Press Releases ◽  
Content Type ◽  
Current Change ◽  
Empirical Tests ◽  
A Company ◽  
Practical Implications ◽  
A Current

Purpose The purpose of this paper is to study the relation between compensation clawbacks and lawsuits and analyze how these two corporate disciplinary forces interact. This paper hypothesizes that by allowing firms to recoup compensation from managers who breach their fiduciary duty, clawbacks provide a form of discipline that potentially reduces the likelihood of managerial wrongdoing, which, in turn, lowers the risk of corporate lawsuits. Design/methodology/approach This paper identifies whether or not a company in the S&P 1500 had a clawback policy between 2007 and 2014 by searching the company filings and press releases. The authors also construct different proxies for litigation risk and lawsuit outcomes using the Audit Analytics Database. They then perform a variety of empirical tests to examine the association between clawbacks and litigation risk and the association between clawbacks and litigation outcomes. Findings This paper finds that firms with higher litigation risk are more likely to adopt a clawback policy. In addition, after the adoption of clawback provisions, litigation risk significantly declines, suggesting that clawback policies are effective in reducing the likelihood of corporate lawsuits. Furthermore, firms with clawback policies are approximately 50 per cent more likely to have lawsuits against them dismissed or settled for lower amounts (approximately 12 per cent lower). Practical implications The findings of this paper provide insights to the efficacy of a current change in compensation regulation, the mandatory clawback adoption requirement by the Dodd–Frank Act of 2010. Originality/value This paper contributes to the literature on both clawbacks and litigation, as it is the first to analyze the relation between the two.

How sell side advisors can reduce litigation risk in light of Delaware’s Rural/Metro decision

2014 ◽  
Vol 15 (2) ◽  
pp. 39-42 ◽  
Author(s):  
Gregory Gooding ◽  
William Regner ◽  
Maeve O'Connor ◽  
Gary Kubek
Keyword(s):  
Mergers And Acquisitions ◽  
Design Methodology ◽  
Fiduciary Duty ◽  
Financial Advisors ◽  
Litigation Risk ◽  
Content Type ◽  
Vice Chancellor ◽  
Court Of Chancery ◽  
Process Failures ◽  
Practical Implications

Purpose – To explain the implications of a March 2014 Delaware Court of Chancery decision that found RBC Capital Markets liable for damages for aiding and abetting breaches of fiduciary duty by the directors of Rural/Metro Corporation in connection with the company’s 2011 sale to an affiliate of Warburg PIncus. Design/methodology/approach – Explains the court’s findings and decision, offers procedural lessons for sell-side financial advisors, and recommends what sell-side advisors can do to limit exposure to aiding and abetting claims. Findings – The Rural/Metro decision opens the door to additional litigation risk for sell-side advisors. However, Vice Chancellor Laster’s opinion also provides a roadmap for how an advisor can limit that risk. Practical implications – Director and financial advisor liability most often results from process failures. Originality/value – Practical guidance from experienced mergers and acquisitions and securities and corporate governance lawyers.

What demographics matter for organisational culture, commitment and identification?

2020 ◽  
Vol 28 (1) ◽  
pp. 274-290
Author(s):  
Natalia Volkova ◽  
Vera Chiker
Keyword(s):  
Design Methodology ◽  
Organisational Culture ◽  
Employee Perceptions ◽  
International Studies ◽  
Content Type ◽  
Specific Finding ◽  
Public Organisations ◽  
A Company ◽  
Practical Implications ◽  
Demographic Effects

Purpose The purpose of this study to establish what demographic characteristics (gender, generations and organisational tenure) play a role in employee perceptions of organisational culture, commitment and identification in Russian public organisations. Design/methodology/approach The data were collected electronically from 248 employees of two public organisations. Three questionnaires were used. Findings Organisational tenure plays a central role in the way how employees perceive organisational culture; tenure also shapes the levels of both commitment and identification. The specific finding of Russian settings is that the longer employees work for a company, the lower the levels of psychological attachments they demonstrate, while it is not the case for some existing international results. The other findings correspond with those in international studies, in which women were more psychologically attached to the organisation and showed a higher level of identification and lower rates of negative forms of this concept than men did. The older the employees are, the higher the level of identification they express. Practical implications Managers working in Russian settings can struggle with engaging and retaining employees. Understanding the demographic effects can help alleviate these challenges. Originality/value Based on empirical findings, this paper contributes to the literature on organisational socialisation by providing evidence of the damaging effects of the length of organisational tenure on psychological attachment to the company (in the form of commitment and identification). Additionally, tenure is the shaping factor of employee perception of organisational culture.

SFC reminding sponsors of the need to adopt an attitude of “professional scepticism”

2017 ◽  
Vol 18 (3) ◽  
pp. 82-84
Author(s):  
Gareth Hughes ◽  
James Comber
Keyword(s):  
Hong Kong ◽  
Design Methodology ◽  
Regulatory Regime ◽  
Group Company ◽  
Content Type ◽  
Professional Skepticism ◽  
Company Limited ◽  
A Company ◽  
Practical Implications ◽  
Do So

Purpose To remind sponsors to adopt an attitude of “professional skepticism” in Hong Kong IPOs. Design/methodology/approach Explains the Securities and Futures Commission (“SFC”)'s sanction on BOCOM International (Asia) Limited (“BIAL”) as a sign of determination to hold sponsors to account as gatekeepers to the Hong Kong capital markets. Findings The SFC has reprimanded and fined BIAL HK$15 million for failing to discharge its duties as a sole sponsor in a listing application for China Huinong Capital Group Company Limited (“China Huinong”), a company established in the PRC. This substantial fine reinforces the need for sponsors to ensure that they fully and properly discharge all of their duties, and that they will be held responsible for any failure to do so, even if the listing is not ultimately approved. Practical implications If sponsors fail to fulfil the requirements required under the sponsors’ regulatory regime, the SFC will be proactive and impose tough sanctions, even if the listing application is eventually withdrawn or returned by the SEHK. Originality/value Practical guidance from experienced regulatory, financial and commercial dispute resolution lawyers.

Conceptualising innovative price models: the RITE framework

2019 ◽  
Vol 14 (4) ◽  
pp. 540-558 ◽  
Author(s):  
Mathias Cöster ◽  
Einar Iveroth ◽  
Nils-Göran Olve ◽  
Carl-Johan Petri ◽  
Alf Westelius
Keyword(s):  
Literature Review ◽  
Design Methodology ◽  
Business Models ◽  
Final Outcome ◽  
Empirical Testing ◽  
Content Type ◽  
Meta Model ◽  
Practical Implications ◽  
A Current ◽  
Structured Literature Review

Purpose The purpose of this paper is to lay a current, research-based foundation for investigation of the concept of innovative price models and its connection to business models. Design/methodology/approach The design is composed of a structured literature review of articles on price models published in 22 journals during 42 years. This then serves as a base for a subsequent conceptual discussion about the foundation of innovative price models. Findings The literature review yields only very few results that are loosely scattered across various areas and mostly without any kind of deeper exploration of the concept of price models. The paper therefore goes on to conceptually explore some fundamental conditions that might influence or even determine price models. The final outcome of this exploration is the relation, intention, technology and environment (RITE) framework that is a meta-model for conceptualising innovative price models. Research limitations/implications The literature review could include additional journals and areas, and empirical testing of the RITE framework as yet has been limited. Practical implications The RITE framework can be used by practitioners as a tool for investigating the potential and usefulness of developing the capability to handle innovative price models. Originality/value The RITE framework provides fundamental conditions, which influence, or even determine, how innovative price models are developed and applied.

Unmasking conflict in vertical coopetition

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Anni Rajala ◽  
Annika Tidström
Keyword(s):  
Design Methodology ◽  
Manufacturing Sector ◽  
Single Case ◽  
Content Type ◽  
Multiple Levels ◽  
A Company ◽  
Practical Implications ◽  
Different Levels ◽  
And Task

Purpose The purpose of this study is to increase understanding about vertical coopetition from the perspective of interrelated conflict episodes on multiple levels. Design/methodology/approach The empirical part is based on a qualitative single case study of a coopetitive buyer-supplier relationship in the manufacturing sector. Findings Conflicts in vertical coopetition evolve from being merely functional and task-related to becoming dysfunctional and relationship-related, as the level of competition increases. The nature of conflict episodes influences the development of vertical coopetition, and therefore, the interrelatedness of conflict episodes is important to acknowledge. Practical implications Although a conflict is considered functional within a company, it may still be dysfunctional as far as the coopetitive relationship with the buyer or seller is concerned. Competition may trigger conflicts related to protecting own technology and knowledge, which may lead to termination of the cooperation, therefore coopetition should be managed in a way that balance sharing and protecting important knowledge to get advantages of coopetition. Originality/value The findings enhance prior research on vertical coopetition by offering new perspectives on causes of conflicts, their management, outcomes and types. The value of taking a multilevel approach lies in the ability to show how conflicts occur and influence other conflicts through the interrelatedness of conflict elements on different levels.

scholarly journals Females who sexually offend

2016 ◽  
Vol 18 (4) ◽  
pp. 296-300
Author(s):  
Carol Ireland ◽  
Rebecca Ozanne ◽  
Jane Ireland
Keyword(s):  
Current Literature ◽  
Design Methodology ◽  
Current Knowledge ◽  
Review Of The Literature ◽  
Content Type ◽  
Practical Implications ◽  
A Current

Purpose The purpose of this paper is to consider the current knowledge in regard to females who engage in sexually harmful behaviour (HSB). Design/methodology/approach This is a brief paper, reviewing current literature. Findings This paper argues the continual limitations in fully understanding this population. However, it suggests the importance of progressing to discuss patterns of offending as opposed to typologies. Practical implications This argues the importance of effective formulation and consideration of patterns when understanding HSB in females. Originality/value This is a current brief review of the literature, summarising key thinking in this area, and some suggested ways forward for further progression.

Beyond customer experience models: identifying idiosyncratic perceptions

2018 ◽  
Vol 36 (7) ◽  
pp. 1311-1328
Author(s):  
Michele Gorgoglione ◽  
Umberto Panniello
Keyword(s):  
Design Methodology ◽  
Scientific Research ◽  
Customer Experience ◽  
Personal Factors ◽  
Content Type ◽  
Segmentation Analysis ◽  
Bank Managers ◽  
Cluster Profiles ◽  
A Company ◽  
Practical Implications

Purpose The purpose of this paper is to demonstrate that a deeper analysis of customer experience (CE) can identify idiosyncratic and critical perceptions in the experiences of groups of customers. Design/methodology/approach The methodology that the authors used is made of three main steps: segmentation analysis, profiling and identification of idiosyncratic clusters’ profiles (i.e. those with a CE perception different respect to the whole sample) and among these idiosyncratic clusters, identification of those that may be critical for the business. Findings The authors identified clusters of customers showing significant differences in their perceived experience with respect to the holistic CE model. Nevertheless, a sample of bank managers assessed three cluster profiles among them to be critical signals a company. The identification of these idiosyncratic patterns provides managers with interesting additional insights that would be hidden in a holistic CE model. Practical implications Managers can gain valuable insights of CE from this analysis that should be added to those coming from an holistic CE model. Originality/value This paper contributes to the scientific research in that it extends the knowledge about CE by showing how personal factors can be identified and how drawing additional managerial insights.

scholarly journals How to increase engagement on social media using the honeycomb model

2020 ◽  
Vol 27 (2) ◽  
pp. 153-167
Author(s):  
Susana Costa Silva ◽  
Wilian Feitosa ◽  
Paulo Duarte ◽  
Marta Vasconcelos
Keyword(s):  
Social Media ◽  
Social Engagement ◽  
Design Methodology ◽  
Convenience Sample ◽  
Content Type ◽  
The Social ◽  
Before And After ◽  
A Company ◽  
New Procedures ◽  
Practical Implications

Purpose The purpose of this paper is to understand how a company could improve public engagement on social media (SM) analysing the case of Alento, which is a human resources and consulting company located in Portugal. The company’s presence on Facebook was analysed by using the honeycomb model for SM functionality, by Kietzmann et al. (2011), as a theoretical framework. Design/methodology/approach The authors implemented some actions to change procedures on SM management. Monitoring five months of data, the authors could compare the SM engagement before and after changes on SM management. Then, a convenience sample of 205 useable questionnaires was collected. The population of the study comprised Portuguese Facebook users who liked the Alento Facebook Fan Page. An analysis of honeycomb dimensions was performed. Findings The engagement level on Alento’s SM was increased by changing procedures identified on survey. In five months, Alento’s number of followers was increased by just 4.5 per cent, interactions were increased by 35 per cent, views were more than twice (+122 per cent) and fans who clicked on Alento’s Facebook page’s links were increased by 146 per cent. Research limitations/implications There were also some limitations related to the sample, since the authors only obtained 205 responses. Therefore, the second suggestion for future investigations would be to conduct the survey on a larger number of people. This study just considers five months after changing procedures. A longer range of time could produce different results. Practical implications The most relevant contribution of the current study is the offer of some insights into the use of a simple tool such as the honeycomb model of Kietzmann et al. (2011) for the analysis of the social engagement from a firm’s perspective, regardless of their nature. Social implications The importance of SM to spread good content and to reduce media costs is reinforced in this study. Originality/value This study is innovative, as it identifies a need of change on SM management, proposes and implements new procedures, checking its results. SM marketing is a new wagon of study, and the problem of how to increase engagement on professional SM is on top priorities of the field.

HCL Technologies puts employees before customers

2014 ◽  
Vol 22 (1) ◽  
pp. 11-14
Keyword(s):  
Information Technology ◽  
Software Development ◽  
Design Methodology ◽  
Pole Position ◽  
Content Type ◽  
Grassroots Innovation ◽  
Percent Increase ◽  
Almost All ◽  
A Company ◽  
Practical Implications

Purpose – Reveals that, in an era when almost all businesses accept that the customer comes first, a company that is putting its employees in pole position is reaping the benefits in terms of innovation, customer satisfaction and profitability. Design/methodology/approach – Underlines the reasons for the employee first, customer second approach at HCL Technologies, the information-technology and software-development division of HCL Enterprise, how this has evolved into the corporate philosophy of “ideapreneurship” at the company and the effects of this corporate philosophy. Findings – Explains that grassroots innovation has led to 20,000 ideas being put forward by some 12,000 employees over the last eight years. Almost 4,500 ideas have been implemented and a further 3,000 are being introduced. They have generated more than $250 million of value. On a wider level, HCL has seen a 500 percent increase in revenues since 2005. Practical implications – Demonstrates that the company, a software-engineering partner for Boeing's 787 Dreamliner passenger jet, is delivering one of the best returns on equity among offshore IT providers by creating an entirely differentiated set of offerings focused both on running and changing the business. Originality/value – Reveals an unorthodox approach to human-resource management that has helped to turn round the fortunes of an information-technology company.

scholarly journals Surprise! We changed the logo

2016 ◽  
Vol 25 (3) ◽  
pp. 239-246 ◽  
Author(s):  
Julien Grobert ◽  
Caroline Cuny ◽  
Marianela Fornerino
Keyword(s):  
Design Methodology ◽  
Current Model ◽  
Brand Attachment ◽  
Content Type ◽  
Brand Familiarity ◽  
Brand Values ◽  
The Impact ◽  
A Company ◽  
Practical Implications

Purpose This paper aims to investigate the impact of brand attachment and familiarity on perceived congruence between the logo and the brand. It explores the role of an under-researched factor, surprise, on perceived congruence in the case of a radical logo change. Design/methodology/approach A study was conducted with 220 students following a university logo change. Perceived congruence between the logos (old and new) and the school brand values was measured for two kinds of students, current and future (i.e. applicants). Findings Results show the importance of surprise in the acceptance of a logo change. Brand familiarity and brand attachment affect surprise in opposite ways, such that higher familiarity increases negative surprise, whereas higher attachment enhances positive surprise. Research limitations/implications This research used a school logo. Because schools represent a particular type of company, brand attachment to another type of brand could be different. The current model needs to be tested in different contexts. Practical implications Companies must pay special attention when communicating with their most attached consumers. In particular, companies that aim to change their logos must prepare for the change by relying on communications that can lead to positive surprise. Originality/value This study was conducted in a real context of logo change. It is the first study to focus on the link among familiarity, attachment and surprise when a radical logo change takes place within a company.

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