Do Analysts' Preferences Affect Corporate Policies?

Degeorge, François; Derrien, François; Kecskés, Ambrus; Michenaud, Sébastien

doi:10.2139/ssrn.2187080

Cited by 2 publications

(2 citation statements)

References 7 publications

(11 reference statements)

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Among the investments, acquisition expenditures decrease by about 1 percent of the firm's total assets. These are not, however, the only effects related to financial analysts’ coverage: Degeorge, Derrien, Kecskés, and Michenaud () find that firms cater to the preferences of sell‐side analysts when they choose their investment policies to obtain more favorable treatment. Sell‐side financial analysts also impact the premium paid for target firms.…”

Section: Takeover Market and Pressure From Financial Market Participantsmentioning

confidence: 99%

Corporate Governance and Takeover Outcomes

Aktas¹,

Croci

Şimşir³

2015

Corporate Governance

View full text Add to dashboard Cite

Manuscript type: ReviewResearch Question/Issue: This article reviews how and through which channels corporate governance shapes takeover outcomes.Research Findings: We summarize the main findings of the empirical literature that investigates the effect of corporate governance mechanisms on takeover outcomes. The internal and external governance mechanisms that we consider are: the board of directors, the takeover market, blockholders, financial markets in general, product market competition, and the labor market. Theoretical/Academic Implications: This article adopts an agency perspective of the firm and reviews the mergers and acquisitions (M&A) literature through the lens of corporate governance. We highlight how the different corporate governance mechanisms affect the takeover process and outcomes. Practitioner/Policy Implications: The article systematizes the current state of the research linking corporate governance and takeovers. In doing so, we emphasize which mechanisms policymakers can use to improve the efficiency of the takeover market. Alternatively, the review also offers indications concerning mechanisms that could be used to mitigate agency conflicts and, as such, increase firm value.

show abstract

Section: Takeover Market and Pressure From Financial Market Participantsmentioning

confidence: 99%

Corporate Governance and Takeover Outcomes

Aktas¹,

Croci

Şimşir³

2015

Corporate Governance

View full text Add to dashboard Cite

show abstract

“…Specifically, it is most likely that the treatment assignments are not random. Similar to other natural experimental settings, like, for example, brokerage house mergers or closures exploited by recent studies on sell-side equity analysts (Irani and Oesch, 2013;Chen et al, 2013;Degeorge et al, 2013b), it is plausible to assume that the treatment assignments are to some extent size related. In the current research design as outlined below, I mitigate a potential size effect by using two different control groups (a first control group with smaller firms and a second control group with larger firms), treatment and firm-fixed effects, as well as size related firm control variables within the DiD regressions.…”

Section: Do Corporate Governance Analysts Matter? Evidence From a Qua...mentioning

confidence: 99%

Corporate Governance, Information Intermediation, and Earnings Management

Lehmann¹

View full text Add to dashboard Cite

Based on four empirical studies, this thesis investigates the interrelation of corporate governance, information intermediation, and earnings management. First, the thesis complements the discussion initiated by the European Securities and Market Authorities about the role of proxy advisors at European shareholder meetings by providing empirical evidence on the influence and method consistency of these advisors for a European setting (Study 1). The respective findings are twofold; they indicate a significant correlation between negative proxy voting recommendations and voting dissent as well as a certain method consistency of these recommendations with respect to the employed governance perceptions. Second, the thesis augments prior work on the usefulness of commercial corporate governance ratings by shedding light on the incremental contribution of the rating vendor's information processing activities (Study 2). The findings of this study suggest that governance rating vendors do not create value in the process of converting public data into aggregated ratings. Third, the thesis extends the perspective of prior research on proxy voting advisory and governance ratings by highlighting the role of corporate governance analysts (Study 3). In doing so, it provides empirical evidence on potential economic consequences of governance analyst coverage. The respective findings suggest that governance analysts serve as information intermediaries by enhancing the firm's information environment and by promoting external monitoring to managers. Fourth and lastly, the thesis adds to research on the link between governance quality and earnings management by highlighting the setting-specific nature of this relationship (Study 4). Specifically, it examines whether the acquirer's governance quality affects the acquirer's earnings management behavior prior to share-based M&A transactions. The study's findings suggest that -in contrast to common claims that strong governance constrains earnings management -acquirers with strong governance engage more aggressively in incomeincreasing accruals manipulation than those with weak governance. Overall, the thesis contributes to prior literature by, first, providing insights into the economic role of corporate governance advisory on capital markets and, second, by highlighting the setting-specific nature of the governance and earnings management relationship.

show abstract

Do Analysts' Preferences Affect Corporate Policies?

Cited by 2 publications

References 7 publications

Corporate Governance and Takeover Outcomes

Corporate Governance and Takeover Outcomes

Corporate Governance, Information Intermediation, and Earnings Management

Contact Info

Product

Resources

About