Internal and external discipline following securities class actions

Internal and external discipline following securities class actions

Companies are sometimes accused of misleading the market. The SEC can punish this with enforcement actions. Alternatively, shareholders can seek redress through a shareholder class action (SCA). Thus, using a sample of 416 securities class actions, this paper shows that SCAs are a catalyst to promot...

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Veröffentlicht in:Journal of financial intermediation 2012, Vol.21 (1), p.151-179
1. Verfasser: Humphery-Jenner, Mark L.
Format: Artikel
Sprache:eng
Schlagworte:
Acquisitions & mergers
Analysis
Auctions
Business ethics
Capital market
Chief executive officers
Class action lawsuits
Corporate governance
Disclosure
Enterprises
Ethics
Fraud
Governance
Managerial turnover
Securities class actions
Securities issues
Securities law
Securities markets
Stockholders
Studies
Take-overs
Takeovers
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Beschreibung
Zusammenfassung:Companies are sometimes accused of misleading the market. The SEC can punish this with enforcement actions. Alternatively, shareholders can seek redress through a shareholder class action (SCA). Thus, using a sample of 416 securities class actions, this paper shows that SCAs are a catalyst to promote disciplinary takeovers, CEO turnover and pay-cuts, and harm CEOs’ future job-prospects.
ISSN:1042-9573
1096-0473
DOI:10.1016/j.jfi.2011.09.001