article thumbnail

How Emphasizing ESG Affects Firm Value

Reynolds Holding

In a new article, we offer novel insights into the conundrum of ESG emphasis and present a conceptual framework for exploring the impacts on firm value of emphasizing both nonmaterial and material ESG factors. Over time, the negative impact of nonmaterial ESG emphasis on firm value becomes more pronounced.

article thumbnail

Corporate Culture In A New Era: Views From The C-suite

Harvard Corporate Governance

This post is based on an article forthcoming in the Journal of Applied Corporate Finance by John Graham , Professor Grennan, Campbell R. Harvey , and Shivaram Rajgopal.

Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

Do Consumers Care About ESG? Evidence from Barcode-Level Sales Data

Harvard Corporate Governance

Despite a substantial number of articles on this issue, the mechanisms through which ESG activities could affect corporate performance and value remain poorly understood. One possibility is that ESG efforts affect value through the discount rate channel. more…)

Finance 210
article thumbnail

Do Individual Directors Matter?

Reynolds Holding

A fundamental question in corporate governance research is whether the board of directors affects firm value. Some argue that directors contribute no additional value to the firm and may even lower its value if they act only as a rubber stamp on the CEO’s decisions. percent of variation in DSQ.

article thumbnail

The Millennial Corporation: Strong Stakeholders, Weak Managers

Reynolds Holding

In a new article , we argue that the intense c-suite focus on ESG has been a product of social demand from investors, employes, and customers transmitted to CEOs through various interacting channels. Second and more important, we identify a novel set of strong personal incentives for CEOs to promote ESG, separate from firm value.

article thumbnail

Voting for Socially Responsible Corporate Policies

Reynolds Holding

In a recent paper , my coauthors and I examine voting on corporate policies when investors care about both maximizing firm value and achieving one or more social objectives. For example, under some technical conditions, corporate voting is effective when all investors share the same general goal (like maximizing firm value).

article thumbnail

Poison Pills in the Shadow of the Law

Reynolds Holding

Though the pill’s deterrence of hostile takeovers may seem beneficial at first glance, a hostile takeover may in some cases benefit shareholders by allowing the acquirer to run the firm more efficiently, thereby increasing shareholder value. Therefore, the impact of poison pills on firm value requires empirical study.