The Strategic Side of Charity: Evidence from M&As (.pdf) (SSRN), Revise & Resubmit at Journal of Finance
Based on an establishment-level analysis of public and private M&As, I show that firms strategically allocate funds to charities associated with target firms. Such corporate charitable giving reflects reciprocity-seeking with target executives, directors, and shareholders, commitment-building with employees, and indirect lobbying with regulators. Whereas insider-affiliated donations are associated with value-destroying takeovers, targeted donations towards blockholders and employees improve deal performance. These results show firms' use of non-market strategies to facilitate investment outcomes.
Selected conference presentations and awards: AEA (2025), Drexel Corporate Governance Conference (2024), Best Paper Award at FIRN Women Conference (2023).
Mobilizing Engagement in Diversity (.pdf) (with Hao Liang)
We examine sovereign wealth funds (SWFs) as a hybrid alternative to traditional government regulation and market-based mechanisms for addressing social externalities. Based on a board gender diversity campaign by the world’s largest SWF, we show that responsible investors allocated more capital to targeted firms, concentrated in those with limited institutional ownership, triggering positive stock market reactions, lowering the cost of capital, and reinforcing collective engagement efforts.
Buying Local Favor? Establishment-Level Evidence on Non-Market Responses to Regulatory Risk (.pdf) (with Emdad Islam and Lubna Rahman)
Firms use targeted corporate philanthropy as a substitute for political insurance to manage regulatory noncompliance risk. Following shocks to firms' local political insurance in closely contested elections, donations to establishment communities in these districts increase. These philanthropic efforts align with local employees’ private benefits and values, with stronger effects for financially constrained firms and weaker effects for those regaining or hedging political insurance.
Selected conference presentations: Conference for Empirical and Legal Studies (2023).
Indirect Influence: Philanthropy along the Supply Chain (.pdf) (with Huu Nhan Duong, Emdad Islam, and Lubna Rahman)
We identify charitable giving as a novel mechanism through which firms can indirectly influence trading relationships and trade outcomes. Exploiting exogenous changes in trading relations and philanthropic demand, we show that firms are 10% more likely to donate to charities in which their suppliers' managers and directors are active. Supplier-affiliated donations lead to higher trade credit extension, greater technological alignment, and more joint investment.
Selected conference presentations: FMA Annual Meeting (2024).
The Disclosure of Environmental Innovation (SSRN) (with Leo Liu, Elvira Sojli, and Wing Wah Tham)
Government interventions to support firms' development of environmental technologies are most effective if they generate societal benefits through knowledge spillovers beyond innovating firms' private returns. We study the social and private returns of environmental technology disclosure through patent filings, and find that the social returns of disclosing 'clean' technologies exceed firms' private returns, indicating a systemic under-disclosure of clean technology.
Selected conference presentations: AEA (2025), PRI Academic Network Conference (2024), SGFIN Sustainability Research Conference (2024).
Informed Acquirers and M&A Outcomes (.pdf) (SSRN), Revise & Resubmit at Review of Corporate Finance
I show that two-stage deals, in which an acquirer engages in a pre-takeover partnership with the target, increases an acquirers’ access to inside target information, but also increases the takeover price resulting from an increase in the target’s share price after the first-stage engagement.
Selected conference presentations and awards: Best PhD Student Paper at the ECGI Workshop on Governance and Control (2018), Best Paper at FIRN Women Conference (2019)
Charity or Commerce? The Market Effects of Local Corporate Philanthropy (with Jiaying Li)
Disaster Relief, Inc.: When is Corporate Philanthropy Good or Bad for Shareholders? (link) (with Hao Liang), Review of Finance, 2025, 29(3) 851-886.
We test the relative importance and conditions under which agency incentives and strategic benefits of corporate philanthropy dominate in the context of disaster relief donations. Although, on average, relief giving decreases returns, the strategic benefits of donating around salient and attention-grabbing events can mitigate these negative effects.
Selected conference presentations: AEA (2023)
Covered by the Australian Financial Review (link).
Elective Stock and Scrip Dividends (link) (with Isabel Feito-Ruiz and Luc Renneboog), Journal of Corporate Finance, 2020, 64, 1016-60.
We find that firms pay scrip dividends, which give investors the choice between receiving new shares or the equivalent value as a cash dividend, for cash preservation purposes.
Selected conference presentations and awards: Best Paper Award at the Spanish Finance Forum Conference (2019)
Cross-Border Acquisitions and Employment Policies (link) (with Hao Liang and Luc Renneboog), Journal of Corporate Finance, 2020, 62, 1015-75.
Shareholders react more positively to M&A announcements by acquirers providing generous employee incentives when the deal is domestic, but negatively when the deal is cross-border, reflecting higher costs associated with managing employee policies across borders and lack of opportunities for eliminating work duplication in cross-border deals.
Selected conference presentations and awards: ECGI Global Corporate Governance Colloquia (2017), Best Paper in Corporate Finance Award at Indonesian FMA Conference (2019)
Failure and Success in Mergers and Acquisitions (link) (with Luc Renneboog), Journal of Corporate Finance, 2019, 58, 650-699.
We provide an overview of the academic literature on the market for corporate control, focusing specifically on firms' performance around and after a takeover. We identify the areas of research for which short-run returns predict (or fail to predict) long-run performance.
Creditor Rights, Claims Enforcement, and Bond Returns in Mergers and Acquisitions (link) (with Peter Szilagyi and Luc Renneboog), Journal of International Business Studies, 2017, 48(2), 174-194.
We find that bondholders of bidding firms respond more positively to cross-border deals that expose their firm to a jurisdiction with stronger creditor rights and more efficient claims enforcement through courts.
Covered by Harvard Law School Forum on Corporate Governance and Financial Regulation.
Leveraged Buyouts: Motives and Sources of Value (link) (with Luc Renneboog), Annals of Corporate Governance, 2017, 2(4), 291-389.
We provides an exhaustive literature review of the motives for public-to-private LBO transactions. We develop a theoretical framework for the potential sources of value creation from going private and summarize whether and how these theories have been empirically verified in the four different strands of literature in LBO research: Intent (of a buyout), Impact (of the LBO on the various stakeholders), Process (of restructuring after the leveraged buyout) and Duration (of retaining the private status).
Covered by Harvard Law School Forum on Corporate Governance and Financial Regulation.
Public-to-private leveraged buyouts (with Luc Renneboog), 2018, The Routledge Companion to Management Buyouts, Ed: M. Wright, D. Siegel, K. Amess, N. Bacon. New York, NY: Routledge.
Mergers and Acquisitions: Long-Run Performance and Success Factors (with Luc Renneboog), 2020, Oxford Research Encyclopedia of Economics and Finance.