Institutional Investors, Corporate Ownership, and Corporate Governance: Global Perspectives

Institutional investors, Corporate ownership, Corporate governance

Going Overboard? On Busy Directors and Firm Value

Abstract The literature disagrees on the link between so-called busy boards (where many independent directors hold multiple board seats) and firm performance. Some argue that busyness certifies a director’s ability and that such directors are value enhancing. Others argue that “over-boarded” directors are ineffective and detract from firm value. We find evidence that (1) the disparate results in prior work stem from differences in both sample composition and empirical design, (2) on balance the results suggest a negative association between board busyness and firm performance, and (3) the inclusion of firm fixed effects dramatically affects the conclusions drawn from, and the explanatory power of, multivariate analyses. We also explore alternative empirical definitions of what constitutes a busy director and find that commonly used proxies for busyness perform well relative to more complex alternatives. Highlights ► The disparate busy director findings result from different samples and methodology. ► Including firm fixed effects results in a constant negative relation. ► The common busy director definition is as informative as more intense alternatives

Telepresence for space: The state of the concept

The purpose here is to examine the concept of telepresence critically. To accomplish this goal, first, the assumptions that underlie telepresence and its applications are examined, and second, the issues raised by that examination are discussed. Also, these assumptions and issues are used as a means of shifting the focus in telepresence from development to user-based research. The most basic assumption of telepresence is that the information being provided to the human must be displayed in a natural fashion, i.e., the information should be displayed to the same human sensory modalities, and in the same fashion, as if the person where actually at the remote site. A further fundamental assumption for the functional use of telepresence is that a sense of being present in the work environment will produce superior performance. In other words, that sense of being there would allow the human operator of a distant machine to take greater advantage of his or her considerable perceptual, cognitive, and motor capabilities in the performance of a task than would more limited task-related feedback. Finally, a third fundamental assumption of functional telepresence is that the distant machine under the operator's control must substantially resemble a human in dexterity

Network Connections in REIT Markets

Relationships play a central role across the spectrum of real estate transactions. Whether negotiating prices, securing funding, or acquiring permits, knowing the right people provides multiple channels to facilitate deal making. To better understand the role of relationships in real estate markets, we examine how the connectedness of REIT directors is associated with deal making, growth, and profitability. We find strong evidence that REIT connections are positively associated with both deal making and accounting based measures of profitability, however, those relations do not translate into better market returns or higher valuations. One explanation of these somewhat contradictory results is that connections also increase firm risk. Preliminary support for this conjecture is found through our examination of each firm’s implied cost of equity capital. Specifically, we find increasing connectedness is associated with a higher cost of equity capital. Thus, connections appear to offer both advantages and disadvantages to REIT managers and shareholders