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Lucian Bebchuk

  • Gordon Gekko Is Back—Using Another Name

    October 2, 2014

    Investors have been pushing for—and often winning—big changes at companies. This week, Ebay EBAY -2.066% split off its PayPal division, a move long urged by Carl Icahn, who controls 30 million shares of the company...One influential study looks at what happened to 2,000 companies targeted by activists over a number of years. It concluded that activism worked out fine for investors, even over a period as long as five years. And “operating performance relative to peers improves consistently,” writes co-author Lucian Bebchuk, an economist at Harvard. This was true even for companies that took on debt or cut capital spending. But another recent study is less upbeat, finding little impact on growth and profit margins.

  • As Dark Money Floods U.S. Elections, Regulators Turn a Blind Eye

    October 1, 2014

    With apologies to the cast of Cabaret, dark money makes the political world go round. Confusing rules and a regulatory void in campaign finance have unleashed a tsunami of cash from anonymous donors that is expected to have unprecedented influence over the midterm elections in November...The petition has found grassroots groups and investors on Wall Street largely in agreement for once. In addition, nearly a dozen senators and more than 40 members of the House have supported it, according to one of the petition’s drafters, Lucian Bebchuk, a professor of law, economics and finance at Harvard. Bebchuk scoffs at those who say new rules to disclose corporate political spending will hurt confidentiality. “One could understand such an argument for letting individuals anonymously contribute their money,” he told Newsweek. “But such an argument loses its force when public companies make political contributions. In such a case, executives contribute not their own money but shareholders’ money, and there is little basis for allowing them to keep the contribution hidden from the shareholders whose money is spent.”

  • Alibaba’s Governance Leaves Investors at a Disadvantage

    September 17, 2014

    An op-ed by Lucian Bebchuk. Wall Street is eagerly watching what is expected to be one of the largest initial public offering in history: the offering of the Chinese Internet retailer Alibaba at the end of this week. Investors have been described by the media as “salivating” and “flooding underwriters with orders.” It is important for investors, however, to keep their eyes open to the serious governance risks accompanying an Alibaba investment. Several factors combine to create such risks. For one, insiders have a permanent lock on control of the company but hold only a small minority of the equity capital. Then, there are many ways to divert value to affiliated entities, but there are weak mechanisms to prevent this. Consequently, public investors should worry that, over time, a significant amount of the value created by Alibaba would not be shared with them.

  • Record Response Urges SEC To Require Disclosure Of Corporate Political Spending

    September 11, 2014

    More than a million comments have been filed with federal regulators urging the government to begin requiring publicly traded corporations to report on their political spending....“The overwhelming support from public comments the petition has attracted, and the strength of the arguments for transparency put forward in the petition, provide a strong case for SEC initiation of a rulemaking process,” Lucian Bebchuk, director of the corporate governance program at Harvard Law School and one of a group of academics who, in 2011, submitted the original petition on the issue, said at a press conference here last week. “Furthermore, opponents of the petition have failed in their comments to provide any good basis for avoiding such a process.”

  • One million Americans want corporations to reveal political spending

    September 8, 2014

    A coalition of academics, good-government advocacy groups and shareholder activists announced last week that one million Americans have written the Securities and Exchange Commission (SEC) asking for a rule to make corporations reveal how they spend money for political purposes...In a blog post, Jackson and fellow petitioner Lucian Bebchuk noted that the issue had attracted far more comments than any other the SEC had ever considered. Asked why, Bebchuk, a widely cited professor of law, economics and finance at Harvard, said, “The case for transparency in this area is clear and compelling to a broad spectrum of people, including individuals who would otherwise not consider expressing a view on SEC matters. The current freedom of public companies to spend money on politics without telling their investors is clearly unacceptable to a large number of people who care enough about it to write to the SEC.”

  • In Allergan Case and Others, Hostile Bidders Are Making the Most of Firms’ Weakened Defenses

    August 26, 2014

    America's corporate citadels are becoming less impregnable. A more aggressive stance by shareholders is opening new avenues to hostile bids and ushering in radical changes to boards and management teams. ... In 2002, 60% of S&P 500 companies had staggered boards, according to Institutional Shareholder Services Inc. Today, just 10% do. A project spearheaded by Harvard Law School Prof. Lucian Bebchuk has floated nearly 200 proposals to destagger boards since 2012. The nonbinding measures received 80% of votes cast, and at least 98 companies have voluntarily adopted them, according to the project's website.

  • Should you follow an activist into a stock? (subscription)

    July 28, 2014

    We’re living in the era of the activist investor. Last year Carl Icahn and his ilk launched initiatives at 200 companies—including Microsoft, Dell, and Dow Chemical—aimed at sprucing up management, improving operations, selling off certain units, and ultimately improving the share price. That’s a sevenfold jump compared with a decade earlier, according to Harvard research, and the ranks of prominent megaphone-wielding investors seem only to be growing. That prompts an obvious question: When Icahn leaps, should you jump too? The short answer: Yes. Evidence shows that buying stocks after change-oriented campaigns are instigated can yield superior returns for several years…Lucian Bebchuk, a Harvard Law School professor who also heads the university's Program on Corporate Governance, found similar initial gains.

  • Nasty medicine

    July 8, 2014

    POISON pills are again being dispensed by corporate America with all the enthusiasm of an exterminator in a rat-infested basement. The metaphorical rodents nowadays are not just hostile bidders—the pests that the poison-pill defence was designed to exterminate, back in the 1980s—but in some cases shareholders simply trying to change the way companies are run…Lucian Bebchuk, a Harvard law professor and campaigner for corporate-governance reforms, calls this “pernicious”: the board would be seeking to stifle legitimate debate among the owners of the company by making it hard to build a majority for change.

  • Where Majority Doesn’t Rule

    May 12, 2014

    At some companies, shareholders lose even when they win. Vornado Realty Trustis a case in point. At every annual meeting since 2007, investors have approved a resolution asking the company to require that the board win a majority of the vote to get re-elected. For the past four years, shareholders in the U.S. real-estate investment trust also have backed a measure asking that each board member be required to stand for election every year. Vornado has refused to implement either proposal...Majority-vote requirements are now common, and the Shareholder Rights Project run by Harvard law professor Lucian Bebchuk has helped get 121 companies to commit to annual elections since 2011.

  • How to Outsmart Activist Investors

    May 1, 2014

    …Since the start of the 21st century, a new breed of shareholder—the activist hedge fund—has frequently played a decisive role in interactions between corporations and markets...A major recent study by Lucian Bebchuk, Alon Brav, and Wei Jiang of activist investments from 1994 through 2007 also found five-year improvements in the operating performance of targeted companies.

  • Bebchuk, Cohen, and Wang win academic award

    July 25, 2013

    In an award ceremony held in New York City last month, the Investor Responsibility Research Center Institute (IRRCi) announced the winners of its the 2013 prize competition. The academic award went to Harvard Law School Professor Lucian Bebchuk LL.M. '80 S.J.D. 84, HLS Senior Fellow and Tel-Aviv University Professor Alma Cohen, and Harvard Business School Professor Charles Wang. The trio received the award for their study, "Learning and the Disappearing Association between Governance and Returns," which was published last month by the Journal of Financial Economics.

  • SEC proposes corporate political spending rules urged by Bebchuk, committee

    January 15, 2013

    The Securities and Exchange Commission recently indicated in an entry in the Office of Management and Budget’s Unified Agenda that it plans to issue by April 2013 a Notice of Proposed Rulemaking on requiring public companies to disclose their spending on politics. The adoption of such a rule was urged in a rulemaking petition submitted by a committee of ten law professors co-chaired by Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84 and by a record number of supporting comments subsequently filed with the SEC.

  • Rev. Martin Luther King Jr. at HLS

    Briefs: Some memorable moments, milestones and a Miró

    October 1, 2012

    In October 1962, the Rev. Martin Luther King Jr. spoke at Harvard Law School on “The Future of Integration.” It was six months before he would be imprisoned in a Birmingham jail, 10 months before the March on Washington, almost two years before the signing of the Civil Rights Act and almost six years before his assassination. “It may be that the law cannot make a man love me,” he said, “but it can keep him from lynching me.”

  • Eight HLS faculty ranked in "High-Impact List" for corporate governance field

    August 30, 2012

    Eight Harvard Law School faculty members were recently ranked among the top 100 corporate governance scholars in the world, in all corporate areas, including management, law, economics, and finance. Included on the American Academy of Management’s list of 100 “high-impact scholars” were HLS Professors Lucian Bebchuk, John Coates, Reinier Kraakman, Mark Roe '75, Steven Shavell and Cass Sunstein '78. Former HLS Dean and current Visiting Professor Elena Kagan '86 and HLS Lecturer on Law Leo Strine also were featured on the list.

  • Harvard Law School Media Roundup: From Gun Control to the Roberts’s Court to the Arab Spring

    July 26, 2012

    Over the past week, a number of HLS faculty members shared their viewpoints on events in the news. Here are some excerpts.

  • Bebchuk named among most influential people in finance

    July 17, 2012

    Professor Lucian Bebchuk has been named as one of the 100 most influential people in finance by Treasury & Risk magazine. The list prepared by the magazine puts together individuals who had significant impact on the world of finance this year.

  • Faculty Viewpoints: After Citizens United

    July 1, 2012

    The Supreme Court’s 2010 Citizens United decision allowed unlimited political expenditures by corporations and unions, which have been used to help fund campaign commercials that have flooded the airwaves during this election season. In recent writings, several Harvard Law faculty members have explored how Citizens United affects a spectrum of stakeholders, including shareholders, corporations, unions and voters.

  • HLS Shareholder Rights Clinic contributes to governance reforms in S&P 500 companies

    April 18, 2012

    A new HLS clinic, in its first year of operation, has already contributed to significant governance reforms in numerous S&P 500 companies. The Harvard Law School Shareholder Rights Project (SRP) is a clinical program at Harvard Law School through which faculty and students assist public pension funds and charitable organizations to improve corporate governance at publicly traded companies in which they are shareowners.

  • Lucian Bebchuk and Rene Stulz

    On World Bank blog, Bebchuk debates executive compensation

    February 17, 2012

    In an online forum, Harvard Law School Professor Lucian Bebchuk engaged in a debate with Ohio State University Professor Rene Stulz regarding the role executive compensations played in the financial crisis.

  • Kurt Hyde, Lucian Bebchuk and Robert J. Jackson, Jr.

    Bebchuk testifies before Senate Banking committee (video)

    February 15, 2012

    On Feb. 15, Harvard Law School Professor Lucian Bebchuk testified before the U.S. Senate Committee on Banking, Housing and Urban Affairs Subcommittee on Financial Institutions and Consumer Protection at a hearing entitled “Pay for Performance: Incentive Compensation at Large Financial Institutions.”

  • Bebchuk, Shavell, Kaplow, Fried, and Cohen Make SSRN’s Top Ten List

    January 13, 2012

    Harvard Law School’s faculty and fellows earned the top ranking for the total number of citations of their work on the Social Science Research Network (SSRN), according to cumulative statistics released for 2011. HLS faculty members captured five out of the top 10 slots – including the number one slot – among law school faculty in all legal fields.

  • Hearsay - Winter 2011 Bulletin

    Hearsay: Faculty short takes

    December 6, 2011

    “Politics and Corporate Money” Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84 Project Syndicate Sept. 20, 2010 “A recent decision issued by the United States Supreme Court expanded the freedom of corporations to spend money on political campaigns and candidates. … This raises well-known questions about democracy and private power, but another important question is often overlooked: who should decide for a publicly traded corporation whether to spend funds on politics, how much, and to what ends?

  • Bebchuk recognized for excellence in corporate governance

    September 23, 2011

    At the 2011 annual meeting of the International Corporate Governance Network held in Paris, Professor Lucian Bebchuk was awarded an ICGN award for excellence in corporate governance. ICGN awards are given annually in recognition of “exceptional achievements in the corporate governance field.”

  • Committee co-chaired by Bebchuk submits SEC rulemaking petition on political spending

    August 9, 2011

    The Committee on Disclosure of Corporate Political Spending, co-chaired by Harvard Law School Professor Lucian A. Bebchuk LL.M. ’80 S.J.D. ’84 and Robert J. Jackson, Jr. ’05, associate professor at Columbia Law School, submitted a rulemaking petition to the Securities and Exchange Commission. The petition urges the commission to develop rules to require public companies to disclose to shareholders the use of corporate resources for political activities.

  • Bebchuk named president-elect of the Western Economic Association International

    July 11, 2011

    In its recent annual meeting held in San Diego, the Western Economic Association International elected Harvard Law School Professor Lucian Bebchuk to be its president-elect during 2011-2012.

  • Harvard Law School Building

    Harvard faculty and fellows contribute most of the ‘Top Ten Corporate and Securities Law Articles’ of 2010

    June 3, 2011

    This year’s list of “Top Ten Corporate and Securities Articles” based on an annual poll of corporate and securities law academics includes six articles authored or co-authored by Harvard Law faculty and fellows. The top ten articles, selected from a field of more than 440 pieces, will be reprinted in an upcoming issue of the Corporate Practice Commentator.

  • Harvard Law Faculty Lead SSRN Ranking

    January 20, 2011

    Harvard Law School’s faculty earned the top ranking for the number of academic papers authored and downloaded on the Social Science Research Network (SSRN), according to cumulative statistics  released for 2010. HLS faculty members captured 10 of the top 100 slots–including the number one slot–among the top 100 law school professors (in all legal areas) in terms of readers’ use of their work.

  • Bebchuk named 2010 ‘Governance Star’

    December 22, 2010

    Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ‘84, director of the Program on Corporate Governance, was selected as one of 2010’s top 10 “governance stars” by Global Proxy Watch, an international corporate governance newsletter.

  • Corporate Governance Network debuts new E-Journal

    July 21, 2010

    The Social Science Research Network recently announced the distribution of a new e-journal on Bankruptcy, Financial Distress, & Reorganization provided by Corporate Governance Network (CGN).

  • Faculty Scholarship: Bebchuk, Cohen and Spamman on Executive Compensation at Bear Stearns and Lehman Brothers

    July 12, 2010

    A recent study, “The Wages of Failure: Executive Compensation at Bear Stearns and Lehman 2000-2008,” by Professor Lucian A. Bebchuk LL.M. ’80 S.J.D. ’84, Visiting Professor Alma Cohen and Lecturer on Law Holger Spamann S.J.D. ’09 refutes the widespread assumption that the wealth of the top executives at Bear Stearns and Lehman Brothers was largely wiped out when their companies collapsed. According to the authors, many have used this account to dismiss the view that pay structures caused excessive risk-taking, but, they say, that standard narrative turns out to be incorrect.

  • Hard Hats Required: The risky business of repairing the U.S. financial system

    July 1, 2010

    Two years after the government bailout of Bear Stearns set off the first shock wave, the Bulletin interviewed HLS faculty and alumni on what went wrong, on where the greatest dangers remain in our financial system and what to do about them.

  • HLS cited for impact on corporate governance

    March 31, 2010

    HLS’s Program on Corporate Governance—and many individuals affiliated with HLS—are among the most influential leaders in the study of corporate governance, according to a recent review by Directorship magazine. Thirty-four HLS-affiliates made the Directorship 100 list – an annual list of the 100 most influential directors, professors, regulators, politicians, and advisers who have made a lasting impact on corporate governance.

  • Bebchuk, Cohen, and Spamann in Project Syndicate: Paid to fail

    March 24, 2010

    "Paid to Fail," an op-ed co-written by HLS Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84, Visiting Professor Alma Cohen, and Lecturer on Law Holger Spamann S.J.D. ’09 appeared in Project Syndicate on March 18, 2010. It is the latest installment of Professor Bebchuk's monthly column for the syndicate.

  • Bebchuk: Corporate political speech is bad for shareholders

    March 1, 2010

    Corporate political speech is bad for shareholders,” an op-ed by HLS Professor Lucian Bebchuk LL.M ’80 S.J.D. ’84, is the latest installment of his monthly column in Project Syndicate.

  • Bebchuk in Project Syndicate: The CEO Pay Slice

    January 29, 2010

    The CEO Pay Slice,”  an op-ed co-written by HLS Professor Lucian Bebchuk, appeared in Project Syndicate on January 18, 2010.

  • WEBCAST: Bebchuk testifies before House Financial Services Committee

    January 22, 2010

    HLS Professor Lucian Bebchuk testified before House Financial Services Committee at a hearing entitled “Compensation in the Financial Industry,” on Friday, Jan. 22.

  • Bebchuk, Cohen, and Spamann in FT: Bankers had cashed in before the music stopped

    December 8, 2009

    The op-ed, “Bankers had cashed in before the music stopped,” was co-written by Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84, Visiting Professor Alma Cohen, and Lecturer on Law Holger Spamann S.J.D. ’09. It appeared in the December 7, 2009, edition of the Financial Times.

  • Jesse Friedand Lucian Bebchuk

    Bebchuk and Fried: Taming the Stock Option Game

    December 1, 2009

    This op-ed by Harvard Law School Professors Lucian Bebchuk LL.M. ’80 S.J.D ’84. and Jesse Fried, entitled “Taming the Stock Option Game,” appeared in the November 2009 edition of Project Syndicate. This article builds on their study “Equity Compensation for Long-term Performance.” Bebchuk and Fried are co-authors of “Pay without Performance: The Unfulfilled Promise of Executive Compensation.”

  • Bebchuk and Spamann

    Bebchuk and Spamann in NYT: Reducing incentives for risk-taking

    October 13, 2009

    This op-ed co-written by Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84 and Holger Spamann, “Reducing incentives for risk-taking,” appeared in the October 12, 2009, edition of the New York Times. Bebchuk is a professor of law, economics and finance and director of the Program on Corporate Governance at Harvard Law School, and Spamann is co-executive director and a fellow of the HLS corporate governance program. Their op-ed builds on their joint paper, “Regulating Bankers’ Pay.”

  • Bebchuk: Unblocking corporate governance reform

    October 1, 2009

    The op-ed by Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84, entitled “Unblocking corporate governance reform,” appeared in Project Syndicate. This op-ed is the most recent installment of Bebchuk’s commentary, which he offers monthly in a series of columns entitled “The rules of the game.”

  • Bebchuk: Why financial pay shouldn’t be left to the market

    September 8, 2009

    The following op-ed by Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84, “Why financial pay shouldn’t be left to the market,”  is the most recent of his monthly columns in the international newspaper association entitled “Project Syndicate.”

  • Bebchuk in WSJ: Bonus guarantees can fuel risky moves

    August 27, 2009

    The following op-ed by Harvard Law School Professor Lucian Bebchuk LL.M. ’81 S.J.D. ’84, “Bonus guarantees can fuel risky moves,” appeared in the August 27, 2009 edition of The Wall Street Journal. He is the director of the Program on Corporate Governance at HLS.

  • Professor Lucian Bebchuk

    Bebchuk leads charge urging SEC to give corporate shareholders more rights

    August 19, 2009

    Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84 submitted a letter to the Securities and Exchange Commission calling for the adoption of a rule that would facilitate shareholder director nominations. The letter was signed by a bi-partisan group of 80 professors of law, business, economics, and finance, representing 47 universities around the U.S.

  • Bebchuk on executive compensation: Let the Good Times Roll Again?

    July 31, 2009

    Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84, director of HLS’s Program on Corporate Governance wrote “Let the Good Times Roll Again?” for his July column for Project Syndicate, an international association of 425 newspapers in 150 countries. His recent article draws on his testimony before the Financial Services Committee of the U.S. House of Representatives, and his white papers “Equity Compensation for Long-Term Performance” and “Regulating Bankers’ Pay.”

  • Works by HLS faculty most downloaded on SSRN

    July 15, 2009

    The academic work of the Harvard Law School faculty is downloaded from the online database of the Social Science Research Network (SSRN) more frequently than that of any other law school faculty, according to the popular law blog, Brian Leiter’s Law School Reports. Works by HLS faculty were downloaded 107,591 times during the period studied for the survey.

  • Bebchuk discusses “The Rules of the Game” in new monthly newspaper column

    July 1, 2009

    Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84 will be writing a monthly column for Project Syndicate, an international association of 425 newspapers in 150 countries, with a total circulation of about 56 million papers. Bebchuk’s series of monthly commentaries, titled “The Rules of the Game,” will focus on finance and corporate governance.

  • WEBCAST: Bebchuk testifies before House Financial Services committee

    June 11, 2009

    Harvard Law School Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84 testified before the House Financial Services Committee in a hearing titled “Compensation Structure and Systematic Risk,” on Thursday, June 11, 2009.  Watch a webcast of the hearing

  • Bebchuk in WSJ: Key Ways to Reform Corporate Elections

    June 2, 2009

     The following article “Key Ways to Reform Corporate Elections” by HLS Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84 appeared in the May 27 edition of The Wall Street Journal. Bebchuk is the director of the Program on Corporate Governance at Harvard Law School, and the author of “The Case for Shareholder Access to the Ballot,” “The Myth of the Shareholder Franchise” and “The Case for Increasing Shareholder Power.”

  • Bebchuk: How to give banks confidence to lend to businesses

    December 19, 2008

    The following op-ed, “How to give banks confidence to lend to businesses,” was co-written by Harvard Law School Professor Lucian Bebchuk LL.M. ’80, S.J.D. ’84 and Italy Goldstein, a professor at the Wharton School of Business. It appeared in the December 19, 2008, edition of the Financial Times.

  • Bebchuk discusses how to fix the Treasury’s emergency plan

    September 26, 2008

    The following op-ed by Professor Lucian Bebchuk LL.M. ’80 S.J.D. ’84, “How to pay less for distressed financial assets,” was published in the September