Brian Bolton
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Brian BoltonAssistant Professor of Finance 603.862.1709 brian.bolton@unh.edu |
Fields of Specialization:
Primary Research: Corporate governance, capital structure, financial econometrics
Secondary Research: Initial public offerings, mergers, real estate, asset pricing, earnings quality
Teaching: Corporate finance, institutions, investments, financial statement analysis
Secondary Research: Initial public offerings, mergers, real estate, asset pricing, earnings quality
Teaching: Corporate finance, institutions, investments, financial statement analysis
Education:
PhD, University of Colorado at Boulder, Finance
MBA, University of Texas at Austin, Finance
BBA, Southern Methodist University, Finance & Real Estate
MBA, University of Texas at Austin, Finance
BBA, Southern Methodist University, Finance & Real Estate
Recent Research:
Working Papers/Projects:
“Corporate Governance and Initial Public Offerings” with Sanjai Bhagat, Srinivasan Rangan, and Steve Rock
“Capital Structure and Corporate Governance” with Sanjai Bhagat
“Skewness and the Momentum Effect” with Jaime Zender
“Corporate Governance and Earnings Quality” with Sanjai Bhagat and Katherine Gunny
Dissertation: “Corporate Governance and Firm Performance”
Advisor: Sanjai Bhagat
Committee: Robert McNown, Roberta Romano, Michael Stutzer, Tom Thibodeau
Advisor: Sanjai Bhagat
Committee: Robert McNown, Roberta Romano, Michael Stutzer, Tom Thibodeau
Abstract: This paper studies the relationship between various measures of firm performance and corporate governance, with a special application to CEO turnover. I utilize a system of equations approach and instrumental variables estimation, testing for the validity of the instruments. I demonstrate that utilizing an econometric approach that allows for the potential endogeneity of governance and performance is essential. I find that ‘good’ governance, as measured by Gompers et al.’s G-Index, Bebchuk et al.’s E-Index, director ownership, and CEO-chair separation, is associated with better current and future ROA. Board independence is negatively associated with ROA. No measure of governance is able to predict stock returns or Tobin’s Q. Following bad performance, firms with higher levels of director ownership and greater board independence are more likely to replace the CEO, as is expected. Given bad performance, better governed firms as measured by the G-Index and E-Index are less likely to replace the CEO, contrary to what might be expected. I conclude that simple measures of governance may be as effective as complex measures in predicting firm performance, may be better indicators of strong governance in situations when governance should matter most, and that efforts to improve governance should focus on director ownership.