PROF. MARC GOERGEN ON CORPORATE GOVERNANCE

A CEO’s political beliefs can significantly influence corporate decisions, dividend policies, and workforce management. The personal political beliefs of CEOs can significantly influence corporate decisions, including dividend policies and workforce management. Research indicates that conservative CEOs, who are generally more risk-averse and prudent, tend to favor stable dividend payouts. In contrast, liberal CEOs, who are more open to change and innovation, may prefer to reinvest earnings into the company rather than distribute them as dividends. Please see my latest article for IE Insights for further details.

My latest study with Luc Renneboog and Yang Zhao looks at insider trades by directors who sit on multiple boards. When these directors face a trading ban in one of their firms due to an impending earnings announcement, we find they often trade in one of their other firms, using their private information, and they make a profit by doing so. These trades aren't illegal, but are they ethical? You can hear more about our findings in this podcast . An executive summary is available from the Harvard Law School Forum on Corporate Governance . The study itself can be downloaded from the website of the European Corporate Governance Institute (ECGI) .

Ever wondered how a CEO's political ideology influences their company's payout policy? In my latest study with Ali Bayat, we find that conservative CEOs are not only more likely to pay dividends, but they also pay higher dividends and often combine them with share repurchases. Interestingly, these payouts are typically funded by drawing on cash reserves and cutting back on capital and R&D spending. Our full study will be published soon in the Journal of Banking and Finance. You can read it here . A podcast summarising the study is available from here .