NEWSLETTER of February 9, 2024

The following content has been added at finexpert:

DIW Berlin
GENDER PAY GAP IN EINEM BETRIEB SINKT MIT MEHR FRAUEN IN FÜHRUNGSPOSITIONEN
Women are underrepresented in senior management positions in the private sector in Germany and worldwide. As the DIW Berlin Women Managers Barometer 2024 shows, progress has been made in recent years in terms of the proportion of women on the boards of large private companies in Germany. Almost a fifth of the board members of the 200 companies with the highest turnover are now women. If we look not only at the largest companies, but also at a representative cross-section of all companies in Germany, the proportion of women at the top management level was recently even slightly higher at more than a quarter, as a representative survey of companies in Germany by the Institute for Employment Research (IAB) shows. Despite the progress made in recent years, gender parity remains a long way off both on the boards of directors and at the top management level in German companies. >more

KfW Research
DATENSCHUTZ, STEUER- UND ARBEITSRECHT SOWIE LANGE VERWALTUNGSVERFAHREN MIT BLICK AUF BÜROKRATIE AM HÄUFIGSTEN GENANNTE INNOVATIONSHEMMNISSE
Data protection, tax and employment law as well as lengthy administrative procedures are the most frequently cited obstacles to innovation with regard to bureaucracy. However, it is almost impossible to quantify the concrete braking effect. In order to avoid a disproportionate burden on innovation activities due to bureaucracy, it is necessary to examine bureaucratic regulations to determine whether the intended protective effects are in reasonable proportion to the innovation-inhibiting effect. Reducing bureaucracy is therefore a small-scale process that requires expert knowledge and patience. One way of preventing the emergence of new bureaucratic burdens is to implement a consistent innovation review of new legal regulations. The digitalization of administrative processes and the interface with companies is another way to reduce the burden of bureaucracy on companies. >more

Allianz Research
COUNTRY RISK ATLAS 2024: ASSESSING NON-PAYMENT RISK IN MAJOR ECONOMIES
The Country Risk Atlas provides comprehensive insights on the economic, political and business environment and sustainability factors that influence non-payment risk for companies in 84 economies. Our analysis is based on our proprietary risk ratings model that is updated every quarter with the latest economic developments and Allianz Trade’s proprietary data on global insolvencies and the business environment. The Country Risk Atlas is designed to help businesses and investors make informed decisions by identifying potential risks and opportunities around the world. >more

Deutsche Bank Research
WIRTSCHAFTLICHES UMFELD 2024: NICHT GÜNSTIG
At the start of the year, the German economy is probably in a technical recession. In view of the adverse economic conditions, little momentum is likely to develop over the course of the year. Only private consumption offers glimmers of hope thanks to strong wage growth combined with falling inflation rates. >more

FOUR FACTS ABOUT ESG BELIEFS AND INVESTOR PORTFOLIOS
Stefano Giglio, Matteo Maggiori, Johannes Stroebel, Zhenhao Tan, Stephen P. Utkus, and Xiao Xu
2023
We analyze survey data on ESG beliefs and preferences in a large panel of retail investors linked to administrative data on their investment portfolios. The survey elicits investors’ expectations of long-term ESG equity returns and asks about their motivations, if any, to invest in ESG assets. We document four facts. First, investors generally expected ESG investments to underperform the market. Between mid-2021 and late-2022, the average expected 10-year annualized return of ESG investments relative to the overall stock market was −1.4%. Second, there is substantial heterogeneity across investors in their ESG return expectations and their motives for ESG investing: 45% of survey respondents do not see any reason to invest in ESG, 25% are primarily motivated by ethical considerations, 22% are driven by climate hedging motives, and 7% are motivated by return expectations. Third, there is a link between individuals’ reported ESG investment motives and their actual investment behaviors, with the highest ESG portfolio holdings among individuals who report ethics-driven investment motives. Fourth, financial considerations matter independently of other investment motives: we find meaningful ESG holdings only for investors who expect these investments to outperform the market, even among those investors who reported that their most important ESG investment motives were ethical or hedging reasons. >more

IDENTIFYING THE REAL EFFECTS OF THE M&A MARKET ON TARGET FIRMS
Elizabeth Berger, David De Angelis, and Gustavo Grullon
2023
This paper provides causal evidence of the effects of the M&A market on target firms' corporate policies. Using antitrust regulatory thresholds to link the probability of a takeover to the size of the firm, we find evidence that firms intentionally reduce their size to elicit a takeover bid. They do so by limiting asset growth and increasing their payouts when they have excess cash. The treatment effect is stronger among firms with greater control over their market value and incentives to cash out via a merger. Our results reveal that antitrust exemptions can create perverse incentives that limit growth. >more