Are the seeds of bad governance sown in good times?
By: Antoinette Schoar, Ebonya L. Washington
Contributors: Washington, Ebonya L.; National Bureau of Economic Research
Series: NBER working paper series -- working paper 17061; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 17061.
Publisher: National Bureau of Economic Research
Published: 2011
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Description: "This paper examines the extent to which the corporate governance structure of a firm arises endogenously in response to its performance.  We demonstrate that following periods of abnormally good performance managers are more likely to call special meetings and to propose and pass governance measures that are contrary to shareholder interests (based on IRRC classification).  These results are driven primarily by firms that are characterized as having poor governance according to either the GIM Index or the proportion of activist shareholders.  Following these special meeting we find that next quarter performance of the firm is negative.  Our results are consistent with an interpretation of shareholder inattention to governance following good firm performance or a desire to reward management for good past performance.  Overall our evidence seems more consistent with the former interpretation"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 8/18/2011.

Includes bibliographical references.

Also available in print.

System requirements: Adobe Acrobat Reader.

Mode of access: World Wide Web.