Do directors perform for pay?

Many corporations reward their outside directors with a modest fee for each board meeting they attend. Using a large panel data set on director attendance behavior in publicly-listed firms for the period 1996–2003, we provide robust evidence that directors are less likely to have attendance problems at board meetings when board meeting fees are higher. This is surprising since meeting fees, on average roughly $1,000, represent an arguably small fraction of the total wealth of a representative director in our sample. Thus, corporate directors appear to perform for even very small financial rewards.     

Women in the boardroom and their impact on governance and performance

We show that female directors have a significant impact on board inputs and firm outcomes. In a sample of US firms, we find that female directors have better attendance records than male directors, male directors have fewer attendance problems the more gender-diverse the board is, and women are more likely to join monitoring committees. These results suggest that gender-diverse boards allocate more effort to monitoring. Accordingly, we find that chief executive officer turnover is more sensitive to stock performance and directors receive more equity-based compensation in firms with more gender-diverse boards. However, the average effect of gender diversity on firm performance is negative. This negative effect is driven by companies with fewer takeover defenses. Our results suggest that mandating gender quotas for directors can reduce firm value for well-governed firms.     

CEO turnover and bondholder wealth

We examine the impact of CEO turnover announcements on bondholder wealth, stockholder wealth, and overall firm value. Using publicly traded data for the period from 1973 to 2000, we find evidence consistent with both the wealth transfer and signaling hypotheses. Specifically, we find that CEO turnover events are associated with lower bondholder values, higher stockholder values, and that net changes in firm value are a function of turnover type (forced vs voluntary and outside vs inside firm replacements) and the riskiness of the firm’s debt (investment vs non-investment grade). Overall, the results contribute to the understanding of the effects of corporate governance mechanisms, of which CEO turnover is an extreme form, on bondholders.     

Earnings management and initial public offerings: The case of the depository industry

In a typical IPO, insiders are “net sellers” of IPO shares; however, in a demutualizing thrift, insiders are “net buyers” of IPO shares. Using a sample of mutual depository IPOs, we find evidence consistent with earnings management prior to the conversion of mutual thrifts. We find on average that mutuals report lower ROA and increased loan loss provisions and loan loss reserves in the period prior to the demutualization. Using a two-stage approach, we also find that the level of discretionary loan loss provisions and discretionary reserves are positively related to both the level of insider participation in the IPO and the first-day returns to investors. Our results are consistent with management of mutual thrifts benefiting at the conversion from reduced pre-IPO earnings and book equity resulting from earnings management.     

The Challenges of Detection and Enforcement of Insider Trading

Taking advantage of the China’s recent anti-corruption campaign, we attempt to examine the effect of public governance on a firm’s incentive to commit fraud. Using enforcement actions data from the Chinese Securities Regulatory Commission (CSRC) from 2004 to 2014, we find that, due to enhanced public governance, firms are less likely to commit fraud in the post-campaign period than in the pre-campaign period. We further show that the effect of public governance is more evident in privately held listed firms, in firms with weak legal environment, and in firms in areas with poor local economies. In addition, we find that older CEOs respond less actively to the public governance caused by anti-corruption regulations. This paper offers clear policy implications for business ethics by indicating that public governance provides external monitoring of corporate decisions.     

Capital flows and economic growth revisited: evidence from five Sub-Saharan African countries

The study examines the differential effects of capital flows on economic growth in five Sub-Saharan African (SSA) countries over the period 1970–2014. Using the autoregressive distributed lag methodology, the findings show that in the long-run capital flows (i.e. foreign direct investment (FDI), aid, external debt, and remittances) have different effects on economic growth. FDI has a significant positive effect in Burkina Faso and negative effects in Gabon and Niger whereas the impact of debt is negative in all countries. Aid, however, promotes growth in Niger and Gabon whiles it deters growth in Ghana. Remittances, on the other hand, have a significant positive effect in Senegal. Finally, gross capital formation is significant in most of the countries and the impact of trade is mixed. These results suggest that the benefits of capital flows in SSA have been overemphasized.     

Reciprocity in Caring Labor: Nurses’ Work in Residential Aged Care in Australia

Feminist economists identify reciprocity as a motivation for both paid and unpaid caring work. In general, reciprocity describes people responding to each other in similar ways, either benevolently or harmfully. The quality of care is potentially increased when care relationships are motivated by positive and generalized forms of reciprocity and decreased with negative forms of reciprocity. This study draws on nursing literature and two qualitative studies in Australian residential aged care facilities, conducted in 2002–3 and 2009, to identify a new form called “professional reciprocity.” This form of reciprocity involves deliberate and skilled relational work by nurses to facilitate mutual and interdependent exchanges with care recipients that are beneficial to both care recipients and nurses. This study argues that professional reciprocity, as a skill that can be taught, is important for achieving quality care and workers’ job satisfaction.     

Active engagement with nature: outdoor adventure tourism,sustainability and wellbeing

Abstract

This article draws on the conflicting arguments surrounding outdoor adventure tourism activities to determine if such activities might usefully be considered beneficial for humans and nature, and how they might offer avenues for sustainable tourism practice. Research in the field has often examined outdoor adventure activities through a lens that either highlights their negative environmental impacts or has sought to conceptualise motivations and/or experiences. In this article, we argue that through practices that are often seen as destructive, there is the possibility to think differently about human-nature relationships and pro-environmentalism. To explore these issues, we draw on data collected from a series of semi-structured interviews with outdoor adventure tourists. Our analysis highlights how outdoor adventure tourism facilitates reconnections to nature, offering potential wellbeing impacts and pro-environmental attitudes and behaviours. We conclude that outdoor adventure activities as a form of sustainable tourism have potential implications for our understanding of, and engagement with, sustainability, mental health and wellbeing.     

Paternalistic Capitalism

Brazil’s political-economic structure has rapidly evolved over the past decade, shedding its shallow policy alignment with neoliberalism of the 1990s. Brazil’s large, diversified industrial base was painfully constructed over the course of the twentieth century. A major and sustained political realignment, which began in 2003, has resulted in two essential thrusts in development policy: (i) a “growth with equity” strategy that has dramatically reduced poverty and inequality; and (ii) a state-led “industrial policy” designed to upgrade manufacturing and direct the accumulation process toward specific sectors, highlighting and consolidating the National Innovation System (NIS). Nonetheless, as a result of the commodity boom that swept through Latin America, Brazil’s natural resource sector achieved outsized growth from 2002 to 2012. One result has been a shift toward resource intensive activities and a broad opening to low-cost Chinese manufactures. Utilizing an institutionalist framework and method, this article analyzes the cohesion of the NIS and the emergence of the “deindustrialization” debate. Also, it assesses the instrumental nature of the “growth with equity” strategy. The article hypothesizes the viability of an endogenous “neo-developmentalist” strategy, while acknowledging the emergence of fundamental exogenous forces and structural ceremonial/institutional factors that have impeded the consolidation of a Brazilian social structure of accumulation.