Enterprise Risk Management, Corporate Governance And Systemic Risk: Some Research Perspectives

The general goal of Enterprise Risk Management (ERM) processes is to generate economic value through the coverage of firm business risk, on the one hand, and by exploiting the positive side of uncertainty conditions, on the other hand. The increasing attention attributed to ERM in the creation of economic value has led to even greater interactions between risk management mechanisms and the corporate governance system. In other words, in the last two decades, the relationships between corporate governance and ERM increased since the ERM processes have been considered more and more as critical drivers to combine strategic objectives with relative low volatility of company performance. The basic idea is that a good corporate governance system must deal about specific risks along with their interactions and, at the same time, the firm’s business risk as a whole. Moreover, an efficient and effective ERM system provides clear information about linkages between strategic opportunities and risk exposure and offers tools able to manage in an optimal way the negative side of business risk (or downside risk) as wellas its positive side (or upside risk). Accordingly, extant studies concerning the relationships between ERM and corporate governance have been focusing on a micro-level of analyses (i.e., the individual organization) and, specifically, on a firm’s benefits that stem from the adoption of proper ERM processes that are consistent with corporate governance goals and are able to sustain the increase of economic value while maintaining a bearable business risk over time. From our initial analyses, a gap in literature arises. We argue that the interdependence between ERM and corporate governance may be analyzed from a broader point of view as well (i.e., the firm and its task environment composed by its suppliers, customers, and partners). In particular, our research idea is to enlarge traditional studies about interrelations between corporate governance and ERM taking into account whether such interrelations could be a driver of risk transfer from the focal organization to other organizations that belong to its task environment. Moreover, this study aims to deepen the mechanisms by which the transfer of risk from a focal organization to its task environment may foster the emergence of systemic risk, i.e., a macro risk coming from domino and/or network effects. Therefore, our paper aims to find new research areas by combining micro and macro issues tied to corporate governance, ERM and systemic risk. The starting point of our work is the three following assumptions: 1) The compliance of a firm to ERM processes as well as to corporate governance rules implies the reduction as much as possible of firm business risk; 2) The reduction of the firm business risk leads to externalizing the firm business risk through risk-sharing mechanisms; 3) The risk-sharing may arise like a driver of systemic risk especially in those industries featured by strong network interrelations. Starting from the above assumptions, the paper goal is to open a new research area which combines four academic fields (ERM, corporate governance, corporate finance, and macro-finance). So far, our initial findings tell us that the following research questions arise: RQ1: What are the conditions under which the transfer of business risk towards organizations that belong to a firm task environment is likely to become a source of systemic risk in a specific industry? RQ2: How does the capital structure of a focal firm affect its propensity to transfer business risk not only to commercial but also to financial stakeholders included in firm task environment? RQ3: How does the transfer of business risk influence the capital cost of the focal firm as well as of the organizations that absorbed such risk

A view from inside iron-based superconductors

Muon spin spectroscopy is one of the most powerful tools to investigate the microscopic properties of superconductors. In this manuscript, an overview on some of the main achievements obtained by this technique in the iron-based superconductors (IBS) are presented. It is shown how the muons allow to probe the whole phase diagram of IBS, from the magnetic to the superconducting phase, and their sensitivity to unravel the modifications of the magnetic and the superconducting order parameters, as the phase diagram is spanned either by charge doping, by an external pressure or by introducing magnetic and non-magnetic impurities. Moreover, it is highlighted that the muons are unique probes for the study of the nanoscopic coexistence between magnetism and superconductivity taking place at the crossover between the two ground-states.Comment: 28 pages, 18 figure

Critical chain length and superconductivity emergence in oxygen-equalized pairs of YBa2Cu3O6.30

The oxygen-order dependent emergence of superconductivity in YBa2Cu3O6+x is studied, for the first time in a comparative way, on pair samples having the same oxygen content and thermal history, but different Cu(1)Ox chain arrangements deriving from their intercalated and deintercalated nature. Structural and electronic non-equivalence of pairs samples is detected in the critical region and found to be related, on microscopic scale, to a different average chain length, which, on being experimentally determined by nuclear quadrupole resonance (NQR), sheds new light on the concept of critical chain length for hole doping efficiency.Comment: 7 RevTex pages, 2 Postscript figures. Submitted to Phys. Rev.

Evidence for impurity-induced frustration in La2CuO4

Zero-field muon spin rotation and magnetization measurements were performed in La2Cu{1-x}MxO4, for 0<x< 0.12, where Cu2+ is replaced either by M=Zn2+ or by M=Mg2+ spinless impurity. It is shown that while the doping dependence of the sublattice magnetization (M(x)) is nearly the same for both compounds, the N\'eel temperature (T_N(x)) decreases unambiguously more rapidly in the Zn-doped compound. This difference, not taken into account within a simple dilution model, is associated with the frustration induced by the Zn2+ impurity onto the Cu2+ antiferromagnetic lattice. In fact, from T_N(x) and M(x) the spin stiffness is derived and found to be reduced by Zn doping more significantly than expected within a dilution model. The effect of the structural modifications induced by doping on the exchange coupling is also discussed.Comment: 4 pages, 4 figure

Modification of magnetic and transport properties of manganite layers in Au/La_0.67Sr_0.33MnO_3/SrTiO_3 interfaces

The effect of gold capping on magnetic and transport properties of optimally doped manganite thin films is studied. An extraordinary suppression of conductivity and magnetic properties occurs in epitaxial (001) La_0.67Sr_0.33MnO_3 (LSMO) films grown on SrTiO_3 upon deposition of 2 nm of Au: in the case of ultrathin films of LSMO (4 nm thick) the resistivity increases by four orders of magnitude while the Curie temperature decreases by 180 K. Zero-field 55Mn nuclear magnetic resonance reveals a significant reduction of ferromagnetic double-exchange mechanism in manganite films upon the gold capping. We find evidence for the formation of a 1.9-nm thick magnetic "dead-layer" at the Au/LSMO interface, associated with the creation of interfacial non double-exchange insulating phases.Comment: 4 figure

Correlated trends of coexisting magnetism and superconductivity in optimally electron-doped oxy-pnictides

We report on the recovery of the short-range static magnetic order and on the concomitant degradation of the superconducting state in optimally F-doped SmFe_(1-x)Ru_(x)AsO_0.85F_0.15 for 0.1< x<0.6. The two reduced order parameters coexist within nanometer-size domains in the FeAs layers and finally disappear around a common critical threshold x_c=0.6. Superconductivity and magnetism are shown to be closely related to two distinct well-defined local electronic environments of the FeAs layers. The two transition temperatures, controlled by the isoelectronic and diamagnetic Ru substitution, scale with the volume fraction of the corresponding environments. This fact indicates that superconductivity is assisted by magnetic fluctuations, which are frozen whenever a short-range static order appears, and totally vanish above the magnetic dilution threshold x_c.Comment: Approved for publication in Phys. Rev. Letter

The poisoning effect of Mn in LaFe(1-x)Mn(x)AsO(0.89)F(0.11): unveiling a quantum critical point in the phase diagram of iron-based superconductors

A superconducting-to-magnetic transition is reported for LaFe$_{1-x}$Mn$_x$AsO$_{0.89}$F$_{0.11}$ where a per thousand amount of Mn impurities is dispersed. By employing local spectroscopic techniques like muon spin rotation (muSR) and nuclear quadrupole resonance (NQR) on compounds with Mn contents ranging from x=0.025% to x=0.75%, we find that the electronic properties are extremely sensitive to the Mn impurities. In fact, a small amount of Mn as low as 0.2% suppresses superconductivity completely. Static magnetism, involving the FeAs planes, is observed to arise for x > 0.1% and becomes further enhanced upon increasing Mn substitution. Also a progressive increase of low energy spin fluctuations, leading to an enhancement of the NQR spin-lattice relaxation rate 1/T1, is observed upon Mn substitution. The analysis of 1/T1 for the sample closest to the the crossover between superconductivity and magnetism (x = 0.2%) points towards the presence of an antiferromagnetic quantum critical point around that doping level.Comment: 11 pages, 10 figure

Singling out the effect of quenched disorder in the phase diagram of cuprates

We investigate the specific influence of structural disorder on the suppression of antiferromagnetic order and on the emergence of cuprate superconductivity. We single out pure disorder, by focusing on a series of Y$_{z}$Eu$_{1-z}$Ba$_2$Cu$_3$O$_{6+y}$ samples at fixed oxygen content $y=0.35$, in the range $0\le z\le 1$. The gradual Y/Eu isovalent substitution smoothly drives the system through the Mott-insulator to superconductor transition from a full antiferromagnet with N\'eel transition $T_N=320$ K at $z=0$ to a bulk superconductor with superconducting critical temperature $T_c=18$ K at $z=1$, YBa$_2$Cu$_3$O$_{6.35}$. The electronic properties are finely tuned by gradual lattice deformations induced by the different cationic radii of the two lanthanides, inducing a continuous change of the basal Cu(1)-O chain length, as well as a controlled amount of disorder in the active Cu(2)O$_2$ bilayers. We check that internal charge transfer from the basal to the active plane is entirely responsible for the doping of the latter and we show that superconductivity emerges with orthorhombicity. By comparing transition temperatures with those of the isoelectronic clean system we deterime the influence of pure structural disorder connected with the Y/Eu alloy.Comment: 10 pages 11 figures, submitted to Journal of Physics: Condensed Matter, Special Issue in memory of Prof. Sandro Massid

The onset of magnetism peaked around x=1/4 in optimally electron-doped LnFe(1-x)Ru(x)AsO(1-y)F(y) (Ln = La, Nd or Sm) superconductors

The appearance of static magnetism, nanoscopically coexisting with superconductivity, is shown to be a general feature of optimally electron-doped LnFe(1-x)Ru(x)AsO(1-y)F(y) superconductor (Ln - lanthanide ion) upon isovalent substitution of Fe by Ru. The magnetic ordering temperature T_N and the magnitude of the internal field display a dome-like dependence on x, peaked around x=1/4, with higher T_N values for those materials characterized by a larger z cell coordinate of As. Remarkably, the latter are also those with the highest superconducting transition temperature (T_c) for x=0. The reduction of T_c(x) is found to be significant in the x region of the phase diagram where the static magnetism develops. Upon increasing the Ru content superconductivity eventually disappears, but only at x=0.6.Comment: accepted for publication in PR