Aneesh Raghunandan

The Impact of Mandatory Gender Pay Gap Disclosure in the UK

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Firms are coming under increasing pressure to close and disclose their gender pay gaps. The pressure stems from several sources, including, (i) socially conscious investors; (ii) interest groups advocating the incorporation of ESG factors into corporate decision-making and stakeholder capitalism more broadly; (iii) influential capital market intermediaries such as index providers; and (iv) regulators. For example, in recent years the U.S. Securities and Exchange Commission (SEC) has implemented new rules requiring firms to make disclosures about human capital and, more generally, has increased its focus on diversity, equity, and inclusion (DEI) initiatives within public companies.[1]

Advocates argue that there … Read more

How Are Non-Financial and Financial Misconduct Related?

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Companies face strong incentives to meet expectations – whether their own or those of the capital markets. A wide literature shows that this can lead to deceptive behavior by firms, which can amount to anything from overly aggressive accounting to outright fraud.

Prior research (e.g., Cohen et al. (2008)) also shows that, subsequent to the 2002 Sarbanes-Oxley Act, firms are increasingly engaging in real-activities management – that is, operating decisions taken for short-term financial benefit at the expense of long-term gain – in lieu of, or prior to, accrual-based earnings management. Yet, while we now know a fair bit about … Read more