ESG, Corporate Governance & Future of the Firm

Corporate Political Responsibility in a Captured Economy

Most attention on corporate governance has focused on businesses’ social responsibility. Claudine Schneider and Ed Dolan write that businesses need to take...

History Shows that Voluntary ESG Standards Lead to a More Focused ESG Disclosure

In recent years, ESG reports have become more common for publicly traded companies. However, critics have found the information they provide to...

Investing in Influence: Investors, Portfolio Firms, and Political Giving

A new paper examines the relationship between the rising concentration in institutional investors' ownership of publicly traded U.S. firms and portfolio companies'...

Twitter’s Corporate Leaders Pushed their Stakeholders under the (Musk) Bus

In a new study, we examine whether, in negotiating the sale to Elon Musk, Twitter’s corporate leaders took into account the commitments...

Shareholder Democracy Doesn’t Work. Here’s How It Can.

An opinion piece by Oliver Hart and Luigi Zingales describes how a new voting mechanism could help individual investors persuade companies to...

Have Business Roundtable Companies Lived Up to Their Stakeholder Commitments?  

In 2019, more than 100 CEOs of US public companies signed a Business Roundtable statement in which they pledged to deliver value...

Will “Portfolio Primacy” Throw a Monkey Wrench in Elon Musk’s Plans to Acquire Twitter?

The SEC's definition of fiduciary duty allows institutional shareholders to vote against Elon Musk's Twitter takeover bid thanks to portfolio primacy.

How Enlightened is Enlightened Shareholder Value?

There has been growing support for replacing the traditional corporate purpose with so-called “enlightened shareholder value,” which would guide firms to consider...

Are “Bankruptcy Directors” Bad for Creditors?

A new paper studies the rise of so-called “bankruptcy directors,” typically former bankruptcy lawyers, investment bankers, or distressed debt traders who join...

Should ESG-Driven Investors and Stakeholders Divest or Engage? A Stigler Center/Rustandy Center Panel Explores

Should investors and stakeholders who wish to influence companies to promote desirable social and environmental outcomes focus on actions like divestment and...

Latest news

The Kroger-Albertsons Merger Threatens Smaller Upstream Suppliers

Much of the conversation of the proposed Kroger-Albertsons merger has focused on the risks to consumers. However, the merger also poses serious implications for the grocers’ upstream suppliers, particularly smaller regional firms.

Why Have Uninsured Depositors Become De Facto Insured?

Due to a change in how the FDIC resolves failed banks, uninsured deposits have become de facto insured. Not only is this dangerous for risk in the banking system, it is not what Congress intends the FDIC to do, writes Michael Ohlrogge.

Merger Law Reaches Acquirer Incentives and Private Equity Strategies

Steven C. Salop argues that Section 7 of the Clayton Act prohibits mergers in which the acquiring firm’s unilateral incentives and business strategy are likely to lessen market competition.

Tim Wu Responds to Letter by Former Agency Chief Economists

Former special assistant to the president for technology and competition policy Tim Wu responds to the November 27 letter signed by former chief economists at the Federal Trade Commission and Justice Department Antitrust Division calling for a separation of the legal and economic analysis in the draft Merger Guidelines.

Can the Public Moderate Social Media?

ProMarket student editor Surya Gowda reviews the arguments made by Paul Gowder in his new book, The Networked Leviathan: For Democratic Platforms.

Uninhibited Campaign Donations Risks Creating Oligarchy

In new research, Valentino Larcinese and Alberto Parmigiani find that the 1986 Reagan tax cuts led to greater campaign spending from wealthy individuals, who benefited the most from this policy. The authors argue that a very permissive system of political finance, combined with the erosion of tax progressivity, created the conditions for the mutual reinforcement of economic and political disparities. The result was an inequality spiral hardly compatible with democratic ideals.

Did the Meme Stock Revolution Actually Change Anything?

Many financial commentators thought that the surge of retail investors participating in the stock market, the most notable of whom boosted “meme stocks” like GameStop, would democratize corporate governance and improve prosocial firm behavior, including the promotion of environmental, social, and governance (ESG) goals. In new research, Dhruv Aggarwal, Albert H. Choi, and Yoon-Ho Alex Lee find evidence that the exact opposite took place.