Sky Blog
Over the last two decades, firms have been under growing pressure from investors, business leaders, and activists to increase female and minority representation on boards of directors. First adopted by Norway in 2003, regulations relating to boardroom gender diversity have …
In a recent paper, we explore the engagement practices of public company shareholders and offer several important insights.
First, contemporary shareholder-company engagement is a multi-dimensional and evolving phenomenon with shareholders using, to varying degrees, a wide range of engagement techniques. …
The tremendous growth of institutional investors, particularly large passive funds, has drawn attention to their role in corporate governance. Major investment advisers such as BlackRock, Vanguard, and State Street are among the largest shareholders in many publicly traded firms and …
As institutional investors grow in size and influence, questions arise as to whether they are effective stewards for equity investors. That the three mutual fund families with the most total net assets each holds equity positions in around 5,000 U.S. …
In a new paper, we investigate the relationships between institutional ownership, board diversity, and corporate innovation in U.S.-listed firms. Institutional investors play a crucial role in a firm’s operation and exert considerable influence on the efficient monitoring of innovative investment. …
In recent years, major institutional investors in the U.S. have combined their efforts on environmental, social, and governance (“ESG”) matters. Large institutional investors now vote in lockstep on a variety of corporate issues, jointly lead governance initiatives, and often adopt …
In recent years, demand for companies to promote environmental, social, and governance (“ESG”) values has increased dramatically. Investment in ESG-oriented mutual funds (green funds), rose globally by 53 percent in 2021 to $2.7 trillion (Kishan, 2022). Bloomberg forecasts…
The traditional IPO was once the dominant path to raising capital for a growing company, but challengers, most notably SPACs and direct listings, have emerged. In our essay, we argue that the regulation of public offerings should seek to facilitate …
In a recent working paper, we highlight a significant transnational dimension to a remarkable corporate governance development: the dramatic increase in attempts by institutional investors to influence how the companies they invest in address material environmental, social, and governance (ESG) …
The SEC has long taken a hands-off approach to private markets. Instead of direct regulation, the commission has used investor access restrictions to create high-end contracting environments where investors (in theory) have the resources necessary to fend for themselves. But …
The SEC rule requiring a universal proxy card in director election proxy fights becomes effective today [September 1]. The resurgence of activism is already in progress, and the universal proxy card may significantly facilitate some proxy contests in which an …
“Common Ownership” arises when shareholders hold substantial stakes in different firms that impose externalities on each other, and it challenges the assumption that firms act to maximize their own profits. While firm decisions are ordinarily made by its board of …
An important debate is playing out over the role of institutional investors in the global effort to mitigate climate risk and achieve net-zero emissions. While some believe that institutional investors are sufficient catalysts in preparing us for a low carbon …
Stewardship has, along with sustainability, social equality, biodiversity, and climate risk management, emerged in recent years as a favorite buzzword in corporate governance and investment management circles. But the language used by investors to express stewardship objectives and practices varies …
What is the right governance framework for a public company? This question sits at the core of decades of empirical and theoretical research, and yet we still lack consensus on an answer. In particular, agency-cost essentialists support governance structures that …
The shareholder proposal has long been an effective tool for shareholders to bring emerging corporate governance issues to the attention of a company’s board of directors, its managers, and their fellow shareholders. Over time, shareholder proposals have driven a variety …
The financial media provide information to investors by monitoring firms for fraud, excessive CEO pay, and other questionable behavior, as well as mundane activities such as periodic earnings announcements. However, it is unclear why certain firms get extensive media …
Mark Zuckerberg has virtually all his personal wealth invested in Meta Platforms (formerly Facebook). His incentives as controller of Meta are thus clear: Maximize firm value and private benefits of control, irrespective of the effect that might have on other …
The past decade has seen an explosion of boardroom gender diversity reforms worldwide. As of 2014, 23 countries have amended governance codes and 14 countries have enacted laws to increase gender diversity on corporate boards. While investors play a critical …
U.S. companies continue to demonstrate resilience following another year in which the pandemic imposed itself on world events. Although 2021 did not deliver a full reopening, corporate activity thrived in spite of ongoing uncertainty around “return to work,” building on …