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NEWSLETTER of November 6, 2020


The following content has been added at finexpert:


Studies > Performance

Oliver Wyman
UNLOCKING THE STRATEGIC-MINDED CFO
When a group of chief financial officers (CFOs) were recently asked to describe their role, 70 percent of the CFOs said, “as a true strategic advisor to the business.” Today, CFOs have a critical seat at the senior leadership table, with organizations reaching to Finance not only for survival, but to also look ahead, forecast, and drive future growth. This value-added shift has allowed financial institutions to become more efficient and ultimately more cost effective. However, many organizations are not completely well positioned yet — the business may not have the right infrastructure in place, the necessary talent or the essential forecasting data and analytics. >more

Studies > M & A

Mergermarket
HOW AI IS CHANGING LEGAL DUE DILIGENCE
Mergermarket is pleased to present How AI is changing legal due diligence, published in association with Imprima. With the introduction of artificial intelligence to the legal sector over the past few years, this technology has been gradually changing the way that legal due diligence is conducted. Exploring these trends, Mergermarket, on behalf of Imprima, spoke with six experts from the fields of law and technology to share their insights on the day-to-day use of artificial intelligence in legal due diligence processes and how this might continue to develop. >more

Studies > Alternative Investments

Deloitte
POST-COVID PRIVATE EQUITY: THRIVING IN A BIFURCATED WORLD OF OPPORTUNITY
The COVID-19 pandemic has tested the Private Equity (PE) industry in ways not seen before, handcuffing their ability to pounce as investors everywhere remained cautious or complacent. But as the situation begins to stabilize, we expect PE firms will enthusiastically reengage and help lead the recovery, applying their historic expertise and value-creating capabilities to stand companies back up and position them for long-term success. >more

Studies > Alternative Investments

Invest Europe
PRIVATE EQUITY ACTIVITY H1 2020
Invest Europe, the association representing Europe’s private equity, venture capital and infrastructure sectors, as well as their investors, today published ‘Investing in Europe: Private Equity Activity H1 2020’, a comprehensive report on private equity activity in Europe during the first half of the year. The report reveals a resilient investment and fundraising environment, as investors and fund managers continue to actively invest in European businesses despite the disruption caused by COVID-19. >more


Research Papers > Corporate Governance

THE MARKET FOR CEOS
Peter Cziraki, and Dirk Jenter
2020
We study the market for CEOs of large publicly-traded US firms, analyze new CEOs’ prior connections to the firm, and explore how hiring choices are determined. Our results show that firms hire from a surprisingly small pool of candidates. More than 80% of new CEOs are insiders, i.e., current or former employees or board members. More than 90% of new CEOs are executives firms are already familiar with – either insiders or executives its directors have worked with. Firms raid CEOs of other firms in only 3% of cases, implying a lack of talent reallocation across firms. Pay differences appear too small to explain these hiring choices. The evidence is inconsistent with standard frictionless assignment models and suggests that firm-specific human capital and personal connections determine CEO hiring. >more

Research Papers > Corporate Finance

SECURITIES LENDING AND CORPORATE FINANCING: EVIDENCE FROM BOND ISSUANCE
Jennie Bai, Massimo Massa, and Hong Zhang
2020
The security lending market allows institutional investors, such as insurance companies, to lend out their holding assets in exchange for cash collateral, an important but understudied source of funding to conduct off-balance sheet transactions. Since these lenders are also primary investors of corporate bonds, we hypothesize that their lending preference on certain types of bonds can influence corporate financing policies. Indeed, we observe that lenders’ preference for long-term bonds stimulates firms to issue more such bonds and helps boost bond prices. Analysis exploiting a quasi-experiment on the regulatory change of insurance companies in 2010 supports a causal interpretation. Our results shed new insight on the potential impact of security lending on corporate financing policies and bond pricing. >more

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