Corporate Finance, Corporate Governance, Executive Compensation, Corporate Social Responsibility, Ownership Structure.
Director Expertise and Compliance to Corporate Social Responsibility Regulations (with Wentao Li and Swarnodeep Homroy). Corporate Governance: An International Review, 2026. DOI: https://doi.org/10.1111/corg.70060
This paper investigates whether assigning CSR-specific expertise to the board committee legally responsible for CSR improves compliance with mandatory CSR law and shapes how firms organize that compliance. Using Indian listed companies subject to mandatory CSR regulation, we find that CSR expertise on CSR committees is associated with higher compliance and more concentrated CSR activities across categories and locations. These associations are stronger among firms facing greater competitive or financial pressures and those without prior CSR engagement. High compliance combined with CSR expertise is also associated with higher firm value, improved creditworthiness, and greater institutional ownership. Our findings highlight how directors with CSR expertise help companies improve legal compliance with mandatory CSR regulations and pursue more focused CSR strategies. This research identifies committee-level CSR expertise as an important governance mechanism shaping both regulatory compliance and the organization of CSR activities. It demonstrates the benefits of embedding CSR expertise within board structures. We provide evidence that directors with CSR expertise and stronger compliance positively affect firm outcomes. Governments and policymakers could use these findings to promote CSR expertise on corporate boards, incentivize compliance, and promote the convergence of financial and social goals. Our study provides empirical support for recent public policies, including the 2020 EU recommendation to appoint sustainability experts on corporate boards.
ESG and financial performance: Link intensity during the COVID-19 pandemic (with Batoul El Mawla and Jacques Igalens). International Review of Economics & Finance, 2026, 105164. DOI: https://doi.org/10.1016/j.iref.2026.105164
This paper examines the relationship between ESG performance and financial performance during the COVID-19 pandemic, with particular attention to whether the strength of this relationship varies between crisis and non-crisis periods. Using a sample of 9261 unique firms headquartered in 44 countries, representing 72,004 firm-year observations from 2010 to 2024, we find a stronger impact of ESG on financial performance during the pandemic. This positive and highly significant effect persists in the post-COVID period. Our results suggest that firms with stronger ESG performance exhibit greater resilience in times of crisis, with ESG engagement enhancing their ability to absorb both immediate shocks and longer-term adverse effects. ESG investments thus generate tangible benefits during the crisis period and contribute to sustained corporate resilience. These patterns may reflect heightened stakeholder solidarity and increased attention to ESG-related activities during the pandemic, effects that appear to extend beyond the crisis itself. We further estimate the marginal effects of ESG and its sub-dimensions on financial performance before, during, and after the COVID-19 pandemic. The results indicate that the environmental and governance pillars exert stronger positive impacts during the crisis. Finally, we find stronger effects of ESG on financial performance for international companies, companies headquartered in developed countries, and consumer-focused companies.
Ownership Concentration and Firm Risk: The Moderating Role of Mid-Sized Blockholders (with Silvia Rossetto and Raffaele Staglianò). Journal of Business Finance & Accounting, 2022, 1–34. DOI: 10.1111/jbfa.12634
This study analyzes the relationship between mid-sized blockholders and firm risk. We show that ownership structure matters for firm risk, beyond the first largest blockholder. Firms with multiple blockholders take more risk than firms with just one blockholder, even when controlling for the stake of the largest blockholder. Consistent with the diversification argument, we find that firm risk increases by 22% when the number of blockholders increases from one to two. Our results are robust to controlling for blockholder type and firm characteristics. We carry out various robustness checks to tackle endogeneity issues. More generally, we provide evidence that firms' decisions are affected by mid-sized blockholders, and not merely the largest blockholder. This is in line with theoretical predictions.
CEO Stock Option Exercises and Earnings Announcements (with Alexander Guembel).
Stock options are supposed to align CEO interests with those of shareholders. However, CEOs may behave opportunistically when their incentives become very sensitive i.e. when they have options that are about to expire. We investigate whether CEO exercise decisions affect the contents and timing of annual earnings announcements. We show that earnings are more likely to exceed analyst forecasts when CEOs exercise close-to-expiry stock options shortly after the announcements. The likelihood of positive earnings surprise is higher when option exercises are followed by stock sales. We then examine the timing of earnings announcements. The results show that companies accelerate earnings announcements when CEOs exercise stock options shortly after those announcements, especially when the obtained shares are sold. Finally, we investigate the relationship between the incentives given by stock option exercises made close to expiry and the level of accruals. We find a higher level of discretionary accruals when CEOs have to exercise options that are about to expire. The results of the paper are consistent with earnings manipulation when CEOs exercise close-to-expiry stock options shortly after earnings announcements.
National Directors’ Foreign Corporate Board Experience and Foreign Investments (with Shibashish Mukherjee and Niels Hermes).
Employing a sample of 4,053 US-headquartered listed firms, we show that firms with U.S. directors who have experience in code law countries reduce foreign investments. This negative association is particularly strong for non-executive US directors with past foreign board experience as opposed to executive directors, who are typically responsible for setting corporate policies. Additional analysis suggests that firms with such directors exhibit lower levels of operational risk-taking and adopt conservative corporate policies, such as increased payouts through stock repurchases. These results suggest that national directors with experience in foreign institutional environments—specifically, code law systems, negatively influence foreign investment at home.
CEO Stock Option Exercises and Private Information.
I study CEO stock option exercise behavior and use of private information. Using hand-collected data in French companies, I show that most CEOs exercise options during the last year since they stay longer in the company, on average, 6.8 years as CEOs and 18.3 years in the firm. This late exercise makes CEOs lose 55 % of the gain they could have obtained. The results suggest that CEOs with time flexibility use private information when exercising options and time exercises to occur on the most favorable day. The results show that close-to-expiry option exercises are not driven by private information.
Executive Compensation in the Netherlands (with Niels Hermes).