Board Gender Diversity and Corporate Response to Sustainability Initiatives: Evidence from the Carbon Disclosure Project

This paper investigates the effect of female representation on the board of directors on corporate response to stakeholders’ demands for increased public reporting about climate change-related risks. We rely on the Carbon Disclosure Project as a sustainability initiative supported by institutional investors. Greenhouse gas emissions measurement and its disclosure to investors can be thought of as a first step toward addressing climate change issues and reducing the firm’s carbon footprint. Based on a sample of publicly listed Canadian firms over the period 2008–2014, we find that the likelihood of voluntary climate change disclosure increases with women percentage on boards. We also find evidence that supports critical mass theory with regard to board gender diversity. These findings reinforce initiatives being undertaken around the world to promote gender diversity in corporate governance while demonstrating board effectiveness in stakeholder management.     

MODEL‐INDEPENDENT NO‐ARBITRAGE CONDITIONS ON AMERICAN PUT OPTIONS

We consider the pricing of American put options in a model‐independent setting: that is, we do not assume that asset prices behave according to a given model, but aim to draw conclusions that hold in any model. We incorporate market information by supposing that the prices of European options are known. In this setting, we are able to provide conditions on the American put prices which are necessary for the absence of arbitrage. Moreover, if we further assume that there are finitely many European and American options traded, then we are able to show that these conditions are also sufficient. To show sufficiency, we construct a model under which both American and European options are correctly priced at all strikes simultaneously. In particular, we need to carefully consider the optimal stopping strategy in the construction of our process.     

Late Disclosure of Insider Trades: Who Does It and Why?

We attempt to understand the personal incentives that motivate corporate insiders to engage in unethical behavior such as delayed trade disclosure. Delayed disclosure affects corporate transparency and other shareholders in the firm potentially suffer investment losses because they are unaware of insiders’ activities. Using archival data from the 300 largest Australian firms between 2007 and 2011, the results show that risk factors such as insider age and tenure and wealth effects in the form of insider shareholdings affect the likelihood of delayed reporting. Governance positions such as committee membership mitigate this behavior. Our study highlights the importance of considering individual insider’s wealth and risk factors. The self-monitoring role of governance positions is also indicative of the effectiveness of internal corporate governance in the prevention of illegal insider behavior.     

Initial public offerings by mutual thrifts: The regulatory impact

This study analyzes the abnormal returns from a sample of 311 mutual thrift IPOs to investigate the presence of deliberate underpricing and to measure the impact of the changing regulatory environment. The large initial returns are maintained over the following year, indicating deliberate underpricing. Cross-sectional regressions show that the adjusted returns are positively related to the percentage of insiders participating in the IPO and to the size of the conversion. The adjusted returns significantly decrease after regulations are tightened, and there is a rapid rise in adjusted returns when uncertainty is introduced relating to the actual impact of these regulations. (JEL G280)     

Radical Reform to Depoliticise Schools

The current politicisation of education by interventionist local authorities would be removed by the introduction of per capita funding direct to the schools, argues Baroness Cox. This reform would allow the voices of parents and children currently 'trapped' in bad schools to be heard.     

Literature indexing systems for corporate R & D strategy: a case-study in the pharmaceutical industry

Abstract . Information retrieval systems in R & D laboratories are normally used to provide information about the state of the art in fields of corporate interest and to help to solve day-to-day problems. The authors show that such systems can also be used as a tool for planning by R & D managers, corporate planners and others involved in evaluating and setting strategic objectives for the firm. Their approach is to use the Science Citation Index to ascertain the specific institutional setting and geographical locations of researchers in whom material published by the subject firm excited a 'resonance'.
In their study they used the publications lists covering a five-year period provided by two West German companies. They point out that it is possible not only to assess the scientific standing of the R & D laboratory but also to get early warning of spin-offs into hitherto unrecognized fields, to identify 'markets' for the profitable exchange of information and to locate complementary sources of expertise.