Browsing by Author "Wilson, Jared I."

Now showing 1 - 3 of 3
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    Board Changes and the Director Labor Market: The Case of Mergers
    (ECGI, 2017-02) Becher, David A.; Walkling, Ralph A.; Wilson, Jared I.; Kelley School of Business
    We provide benchmarks for board changes over time and in response to the evolution of firm structure. Boards are more stable in the modern era. At the same time, shifts made around mergers are substantial and significantly different than those at non-merging firms. Changes to acquiring boards reflect firm needs, increased demand for executive and merger experience and bargaining between targets and acquirers, rather than agency motives. Conversely, director selection at non-merging firms is driven by general skills and diversity. Our analyses provide insight into the dynamic nature of board structure and characteristics demanded in the director labor market.
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    The Consequences of Limiting Shareholder Litigation: Evidence from Exclusive Forum Provisions
    (Elsevier, 2020-08) Wilson, Jared I.; Kelley School of Business
    In response to an explosion of shareholder litigation, many firms have adopted exclusive forum provisions which limit lawsuits to courts in a firm's state of incorporation. This paper examines the consequences of a required venue for shareholder litigation. Delaware-incorporated companies experience significant increases in firm value around exogenous events that confirmed the use of a specified forum. Reduced legal costs and the designation of the domicile court as the sole forum to hear shareholder claims contribute to the increase in firm value. Overall, these findings suggest that a required venue for shareholder litigation benefits firms by eliminating multi-jurisdictional lawsuits and reducing the threat of claims with little merit.
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    On the relation between corporate social responsibility and financial performance
    (Wiley, 2020) Awaysheh, Amrou; Heron, Randall A.; Perry, Tod; Wilson, Jared I.; Kelley School of Business
    Research Summary This study reexamines the relation between corporate social responsibility (CSR) and financial performance by benchmarking firms against industry peers in a given year to identify best-in-class and worst-in-class firms. We also address distributional issues when using CSR ratings (clustering of CSR scores around the median and material differences across industries and time) and financial performance ratios (the possible influence of extreme values). We find that the best-in-class firms outperform their industry peers in terms of operating performance and have higher relative market valuations (Tobin's Q). When we control for endogeneity, we find that the significant relation between operating performance and CSR categories disappears, calling into question whether this relation is causal. However, we continue to find that best-in-class firms receive higher relative market valuations than industry peers. Managerial Summary The conflicting evidence on the relation between CSR and firm performance may influence a manager's decision to invest in CSR activities and an investor's decision to invest in a firm. Our research provides managers and investors with important implications regarding the value of relative benchmarking. Managers should understand that expectations of CSR performance evolve over time and that investors place higher valuations on the best-in-class CSR firms within an industry.