Home > Store

Corporate Governance Matters: A Closer Look at Organizational Choices and Their Consequences, 2nd Edition

Corporate Governance Matters: A Closer Look at Organizational Choices and Their Consequences, 2nd Edition

eBook (Watermarked)

  • Your Price: $44.79
  • List Price: $55.99
  • Includes EPUB, MOBI, and PDF
  • About eBook Formats
  • This eBook includes the following formats, accessible from your Account page after purchase:

    ePub EPUB The open industry format known for its reflowable content and usability on supported mobile devices.

    MOBI MOBI The eBook format compatible with the Amazon Kindle and Amazon Kindle applications.

    Adobe Reader PDF The popular standard, used most often with the free Adobe® Reader® software.

    This eBook requires no passwords or activation to read. We customize your eBook by discreetly watermarking it with your name, making it uniquely yours.

Also available in other formats.

Register your product to gain access to bonus material or receive a coupon.

Description

  • Copyright 2016
  • Dimensions: 7" x 9-1/8"
  • Edition: 2nd
  • eBook (Watermarked)
  • ISBN-10: 0-13-403160-1
  • ISBN-13: 978-0-13-403160-6

This is the most comprehensive and up-to-date reference for implementing and sustaining superior corporate governance. Stanford corporate governance experts David Larcker and Bryan Tayan carefully synthesize current academic and professional research, summarizing what is known and unknown, and where the evidence remains inconclusive.

Corporate Governance Matters, Second Edition reviews the field's newest research on issues including compensation, CEO labor markets, board structure, succession, risk, international governance, reporting, audit, institutional and activist investors, governance ratings, and much more. Larcker and Tayan offer models and frameworks demonstrating how the components of governance fit together, with updated examples and scenarios illustrating key points. Throughout, their balanced approach is focused strictly on two goals: to "get the story straight," and to provide useful tools for making better, more informed decisions.

This edition presents new or expanded coverage of key issues ranging from risk management and shareholder activism to alternative corporate governance structures. It also adds new examples, scenarios, and classroom elements, making this text even more useful in academic settings. For all directors, business leaders, public policymakers, investors, stakeholders, and MBA faculty and students concerned with effective corporate governance.

Sample Content

Table of Contents

Preface     xxi
Chapter 1  Introduction to Corporate Governance     1
Self-Interested Executives     3
Defining Corporate Governance     7
Corporate Governance Standards     9
Best Practice or Best Practices? Does “One Size Fit All”?    11
Relationship between Corporate Governance and Firm Performance     12
Chapter 2  International Corporate Governance     19
Capital Market Efficiency     20
Legal Tradition     22
Accounting Standards     23
Enforcement of Regulations     26
Societal and Cultural Values     27
Individual National Governance Structures     29
    United States     29
    United Kingdom     32
    Germany     37
    Japan     38
    South Korea     41
    China     .43
    India     44
    Brazil     45
    Russia     47
Endnotes     49
Interlude     55
Chapter 3  Board of Directors: Duties and Liability     57
Board Responsibilities     57
Board Independence     58
The Operations of the Board     59
    Board Committees     60
Duration of Director Terms     64
Director Elections     64
Removal of Directors     66
Legal Obligations of Directors     66
    Fiduciary Duty     67
    Disclosure Obligations under Securities Laws     70
    Legal Enforcement of State Corporate Law (Fiduciary Duties)    70
    Legal Enforcement of Federal Securities Laws     71
    Director Indemnification and D&O Insurance     72
Endnotes     75
Chapter 4  Board of Directors: Selection, Compensation, and Removal     79
Market for Directors     79
    Active CEOs     82
    International Experience     83
    Special Expertise     84
    Diverse Directors     85
    Professional Directors     86
Disclosure Requirements for Director Qualifications     87
Director Recruitment Process     89
Director Compensation     91
    Ownership Guidelines     96
    Board Evaluation     97
Removal of Directors     99
Endnotes     102
Chapter 5  Board of Directors: Structure and Consequences     107
Board Structure     108
Chairman of the Board     112
Lead Independent Director     116
Outside Directors     119
Board Independence     121
Independent Committees     125
Bankers on the Board     126
Financial Experts on Board     127
Politically Connected Boards     128
Employee Representation     128
Boards with “Busy” Directors     131
Interlocked (or Connected) Boards     133
Committee Overlap     135
Board Size     136
Board Diversity     137
Female Directors     138
Summary     141
Endnotes     142
Interlude     150
Chapter 6  Strategy, Performance Measurement, and Risk Management     151
Organizational Strategy     152
Strategy Implementation Process     154
Business Model Development and Testing     156
    Example 1: Fast-Food Chain and Employee Turnover     156
    Example 2: Financial Services Firm and Investment Advisor Retention     158
Key Performance Measures     159
How Well Are Boards Doing with Performance Measures and Business Models?    163
Risk and Risk Management     164
Risk and Risk Tolerance     165
Risk to the Business Model     167
Risk Management     169
Oversight of Risk Management     171
Assessing Board Performance on Risk Management     173
Endnotes     175
Chapter 7  Labor Market for Executives and CEO Succession Planning     181
Labor Market for Chief Executive Officers     181
Labor Pool of CEO Talent     184
CEO Turnover     186
Newly Appointed CEOs     189
Models of CEO Succession     191
    External Candidate     191
    President and/or Chief Operating Officer     193
    Horse Race     194
    Inside–Outside Model     195
The Succession Process     196
How Well Are Boards Doing with Succession Planning?    200
The External Search Process     .203
Endnotes     206
Chapter 8  Executive Compensation and Incentives     211
The Controversy over Executive Compensation     212
Components of Compensation     213
Determining Compensation     217
Compensation Consultants     220
Compensation Levels     221
Ratio of CEO Pay to Other Top Executive Pay     224
Ratio of CEO Pay to Average Employee Pay     227
Compensation Mix     228
Short-Term Incentives     229
Long-Term Incentives     232
Benefits and Perquisites     234
Compensation Disclosure     235
Say-on-Pay     236
Endnotes     240
Chapter 9  Executive Equity Ownership     247
Equity Ownership and Firm Performance     247
Equity Ownership and Risk     250
Equity Ownership and Agency Costs     256
Accounting Manipulation     257
Manipulation of Equity Grants     258
    Other Examples of Value Extraction through Timing     260
Equity Sales and Insider Trading     261
Rule 10b5-1     262
Hedging     264
Pledging     268
Repricing and Exchange Offers     270
Endnotes     273
Chapter 10  Financial Reporting and External Audit     279
The Audit Committee     280
Accounting Quality, Transparency, and Controls     280
Financial Reporting Quality     282
Financial Restatements     284
Models to Detect Accounting Manipulations     290
The External Audit     292
Audit Quality     296
Structure of Audit Industry     296
Impact of Sarbanes–Oxley     298
External Auditor as CFO     301
Auditor Rotation     .302
Endnotes     304
Chapter 11  The Market for Corporate Control     311
The Market for Corporate Control     312
Stock Market Assessment of Acquiring and Target Firms     316
    Who Gets Acquired?    316
    Who Gets the Value in a Takeover?    319
Antitakeover Protections     322
Antitakeover Actions     323
    Poison Pills     325
    Staggered Board     328
    State of Incorporation     330
    Dual-Class Shares     331
Warding Off Unwanted Acquirers     334
Endnotes     336
Chapter 12  Institutional Shareholders and Activist Investors     343
The Role of Shareholders     343
Blockholders and Institutional Investors     346
Institutional Investors and Proxy Voting     349
Activist Investors     351
    Pension Funds     353
    Social Responsibility and Other Stakeholder Funds     355
    Activist Hedge Funds     357
Shareholder Democracy and Corporate Engagement     360
    Majority Voting in Uncontested Director Elections     360
    Proxy Access     361
    Proxy Voting     362
    Corporate Engagement     363
Proxy Advisory Firms     364
Endnotes     369
Chapter 13  Corporate Governance Ratings     375
Third-Party Ratings     375
Credit Ratings     376
Commercial Corporate Governance Ratings     378
    ISS: Corporate Governance Quotient     378
    ISS: Governance Risk Indicators     380
    ISS: QuickScore     380
    GMI Ratings     381
    Testing the Predictability of Corporate Governance Ratings     382
Governance Rating Systems by Academic Researchers     383
The Viability of Governance Ratings     388
Endnotes     389
Chapter 14  Alternative Models of Governance     393
Family-Controlled Corporations     393
Venture-Backed Companies     396
Private Equity-Owned Companies     399
Nonprofit Organizations     402
Endnotes     407
Chapter 15  Summary and Conclusions     413
Testing Remains Insufficient     414
The Current Focus Is Misdirected     415
Important Variables Are Clearly Missing     416
Context Is Important     417
Endnotes     418
Index     419

 

Now fully updated: today's most objective, complete, and actionable guide to corporate governance for every board member, director, officer, investor, and stakeholder.

Updates

Submit Errata

More Information

InformIT Promotional Mailings & Special Offers

I would like to receive exclusive offers and hear about products from InformIT and its family of brands. I can unsubscribe at any time.

Overview


Pearson Education, Inc., 221 River Street, Hoboken, New Jersey 07030, (Pearson) presents this site to provide information about products and services that can be purchased through this site.

This privacy notice provides an overview of our commitment to privacy and describes how we collect, protect, use and share personal information collected through this site. Please note that other Pearson websites and online products and services have their own separate privacy policies.

Collection and Use of Information


To conduct business and deliver products and services, Pearson collects and uses personal information in several ways in connection with this site, including:

Questions and Inquiries

For inquiries and questions, we collect the inquiry or question, together with name, contact details (email address, phone number and mailing address) and any other additional information voluntarily submitted to us through a Contact Us form or an email. We use this information to address the inquiry and respond to the question.

Online Store

For orders and purchases placed through our online store on this site, we collect order details, name, institution name and address (if applicable), email address, phone number, shipping and billing addresses, credit/debit card information, shipping options and any instructions. We use this information to complete transactions, fulfill orders, communicate with individuals placing orders or visiting the online store, and for related purposes.

Surveys

Pearson may offer opportunities to provide feedback or participate in surveys, including surveys evaluating Pearson products, services or sites. Participation is voluntary. Pearson collects information requested in the survey questions and uses the information to evaluate, support, maintain and improve products, services or sites, develop new products and services, conduct educational research and for other purposes specified in the survey.

Contests and Drawings

Occasionally, we may sponsor a contest or drawing. Participation is optional. Pearson collects name, contact information and other information specified on the entry form for the contest or drawing to conduct the contest or drawing. Pearson may collect additional personal information from the winners of a contest or drawing in order to award the prize and for tax reporting purposes, as required by law.

Newsletters

If you have elected to receive email newsletters or promotional mailings and special offers but want to unsubscribe, simply email information@informit.com.

Service Announcements

On rare occasions it is necessary to send out a strictly service related announcement. For instance, if our service is temporarily suspended for maintenance we might send users an email. Generally, users may not opt-out of these communications, though they can deactivate their account information. However, these communications are not promotional in nature.

Customer Service

We communicate with users on a regular basis to provide requested services and in regard to issues relating to their account we reply via email or phone in accordance with the users' wishes when a user submits their information through our Contact Us form.

Other Collection and Use of Information


Application and System Logs

Pearson automatically collects log data to help ensure the delivery, availability and security of this site. Log data may include technical information about how a user or visitor connected to this site, such as browser type, type of computer/device, operating system, internet service provider and IP address. We use this information for support purposes and to monitor the health of the site, identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents and appropriately scale computing resources.

Web Analytics

Pearson may use third party web trend analytical services, including Google Analytics, to collect visitor information, such as IP addresses, browser types, referring pages, pages visited and time spent on a particular site. While these analytical services collect and report information on an anonymous basis, they may use cookies to gather web trend information. The information gathered may enable Pearson (but not the third party web trend services) to link information with application and system log data. Pearson uses this information for system administration and to identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents, appropriately scale computing resources and otherwise support and deliver this site and its services.

Cookies and Related Technologies

This site uses cookies and similar technologies to personalize content, measure traffic patterns, control security, track use and access of information on this site, and provide interest-based messages and advertising. Users can manage and block the use of cookies through their browser. Disabling or blocking certain cookies may limit the functionality of this site.

Do Not Track

This site currently does not respond to Do Not Track signals.

Security


Pearson uses appropriate physical, administrative and technical security measures to protect personal information from unauthorized access, use and disclosure.

Children


This site is not directed to children under the age of 13.

Marketing


Pearson may send or direct marketing communications to users, provided that

  • Pearson will not use personal information collected or processed as a K-12 school service provider for the purpose of directed or targeted advertising.
  • Such marketing is consistent with applicable law and Pearson's legal obligations.
  • Pearson will not knowingly direct or send marketing communications to an individual who has expressed a preference not to receive marketing.
  • Where required by applicable law, express or implied consent to marketing exists and has not been withdrawn.

Pearson may provide personal information to a third party service provider on a restricted basis to provide marketing solely on behalf of Pearson or an affiliate or customer for whom Pearson is a service provider. Marketing preferences may be changed at any time.

Correcting/Updating Personal Information


If a user's personally identifiable information changes (such as your postal address or email address), we provide a way to correct or update that user's personal data provided to us. This can be done on the Account page. If a user no longer desires our service and desires to delete his or her account, please contact us at customer-service@informit.com and we will process the deletion of a user's account.

Choice/Opt-out


Users can always make an informed choice as to whether they should proceed with certain services offered by InformIT. If you choose to remove yourself from our mailing list(s) simply visit the following page and uncheck any communication you no longer want to receive: www.informit.com/u.aspx.

Sale of Personal Information


Pearson does not rent or sell personal information in exchange for any payment of money.

While Pearson does not sell personal information, as defined in Nevada law, Nevada residents may email a request for no sale of their personal information to NevadaDesignatedRequest@pearson.com.

Supplemental Privacy Statement for California Residents


California residents should read our Supplemental privacy statement for California residents in conjunction with this Privacy Notice. The Supplemental privacy statement for California residents explains Pearson's commitment to comply with California law and applies to personal information of California residents collected in connection with this site and the Services.

Sharing and Disclosure


Pearson may disclose personal information, as follows:

  • As required by law.
  • With the consent of the individual (or their parent, if the individual is a minor)
  • In response to a subpoena, court order or legal process, to the extent permitted or required by law
  • To protect the security and safety of individuals, data, assets and systems, consistent with applicable law
  • In connection the sale, joint venture or other transfer of some or all of its company or assets, subject to the provisions of this Privacy Notice
  • To investigate or address actual or suspected fraud or other illegal activities
  • To exercise its legal rights, including enforcement of the Terms of Use for this site or another contract
  • To affiliated Pearson companies and other companies and organizations who perform work for Pearson and are obligated to protect the privacy of personal information consistent with this Privacy Notice
  • To a school, organization, company or government agency, where Pearson collects or processes the personal information in a school setting or on behalf of such organization, company or government agency.

Links


This web site contains links to other sites. Please be aware that we are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of each and every web site that collects Personal Information. This privacy statement applies solely to information collected by this web site.

Requests and Contact


Please contact us about this Privacy Notice or if you have any requests or questions relating to the privacy of your personal information.

Changes to this Privacy Notice


We may revise this Privacy Notice through an updated posting. We will identify the effective date of the revision in the posting. Often, updates are made to provide greater clarity or to comply with changes in regulatory requirements. If the updates involve material changes to the collection, protection, use or disclosure of Personal Information, Pearson will provide notice of the change through a conspicuous notice on this site or other appropriate way. Continued use of the site after the effective date of a posted revision evidences acceptance. Please contact us if you have questions or concerns about the Privacy Notice or any objection to any revisions.

Last Update: November 17, 2020