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Saturday Schedule
Program
Annual
Meeting
Home
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Saturday, January 4, 2003
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10:30 a.m.-12:15 p.m.
Section on Business Associations
Paul G. Mahoney, University of Virginia, Chair |
Wilson A
Marriott Wardman Park Hotel
Mezzanine Level |
Corporate Law in a Time of Crisis
Moderator:
Paul G. Mahoney, University of Virginia
Speakers: - Erica Beecher-Monas, University of Arkansas at Little Rock
- Mitchell L. Engler, Yeshiva University
- Claire Ariane Hill, Chicago-Kent College of Law
Recent failures of external and internal controls in publicly traded firms have produced a sense of crisis for corporate governance. Academics and policymakers have proposed significant changes in the way boards of directors, accountants, and regulators monitor the behavior of corporate management.
This corporate governance crisis, like others that have preceded it, stems from the familiar manager/shareholder agency problem. This panel will examine several different manifestations of the agency problem and potential solutions. Professor Hill's paper, "Rating Rating Agencies," analyzes the behavior of rating agencies, which in theory should serve to reduce informational asymmetries between managers and investors. The paper asks whether and how rating agency performance can be improved. Professor Beecher-Mona's paper, "Enron, Epistemology and Accountability: Disclosure Obligations in a Global Economy," locates the source of several recent corporate governance failures in cognitive biases such as overconfidence. The paper argues that disclosure obligations should be based on empirical observation of organizational behavior. Professor Engler's paper, "The Missing Piece to the Dividend Puzzle: Agency Costs of Mutual Funds," notes that investors themselves can be a source of agency problems. Institutional investors such as mutual funds, in particular, have interests that are not perfectly aligned with those of the individual owners of fund shares. These conflicts make mutual funds less effective voices for optimal dividend policies.
Business Meeting at Program Conclusion
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