Regulation of Corporate Governance: Will it Improve Corporate Performance?

In 1995, the New South Wales Court of Appeal handed down a significant judgment on directors' duties in Daniels v Anderson¹ (the AWA case), following the landmark decision of Rogers CJ (Comm. D.)². In the same year, the Australian Stock Exchange introduced a listing rule under which listed Australian companies will for the first time be required to disclose their corporate governance practices. This article places the important decision in AWA and the ASX's corporate governance rule in the context of recent research in the United States on whether there is a link between corporate governance and corporate performance.     

Stepwise multi-criteria evaluation

In this article we show that quantitative methods for multi-criteria evaluation have three serious shortcomings. First, the addition of an alternative which has bad criterion scores may distort the comparison between other alternatives. Second, the addition of a criterion which does not differentiate between alternatives may distort the comparison between alternatives. Third, when a ranking of alternatives is derived from a multi-criteria evaluation, it suggests complete transitivity. It is shown that intransitivity may occur.Therefore a stepwise procedure is recommended. It involves the removal of all criteria which do not or hardly differentiate between the alternatives and a pairwise evaluation of alternatives.     

Cross Entropy Estimation of the Almost Ideal Demand System for Greek Consumption

Cross entropy is used to estimate the Almost Ideal Demand System for consumption in Greece. The entropy estimates are found to improve upon the SUR estimates. It is recommended that practitioners consider employing entropy based procedures in systems where the data set is small, where there are a large number of parameters, or where the data are deficient.     

Auditing in the Presence of Outside Sources of Information

We examine how an auditor's ability to terminate a multi-period client relationship provides the auditor with a real option whose value depends on the nature of informational asymmetry between the incumbent and other potential auditors. In particular, we isolate conditions under which the auditor's private and public sources of information behave as complements rather than substitutes. In such circumstances, increasing the likelihood of publicly provided information induces the auditor to expend more (rather than less)resources in private information gathering activities.     

Form, function, and finance: architecture and finance theory

At least at first glance, a bank’s customers ought to be concerned with only one thing—the price they must pay for the services they receive. Architecture beyond the merely functional ought to have no role, especially not in the modern global economy in which increasingly automated financial intermediation of all sorts appears to be approaching the ideals of pure competition and perfect efficiency. Even in these financially sophisticated times, however, symbols matter, and the message communicated by these symbols is one which cannot be communicated in any other way. It is necessary for a financial institution, and perhaps even the financial system itself, to have a strong visual presence. There is a visceral appeal of an architecturally distinguished building to the senses that speaks to us in a way that the cerebral appeal of pure information cannot.