Does Greater Public Scrutiny Hurt a Firm's Performance?

Benjamin Bennett, René M. Stulz, Zexi Wang

Public attention to a firm may provide valuable monitoring, but it may also have a dark side by constraining management’s decisions and distracting it. We use inclusion in the S&P 500 index as a positive shock to public attention. Media coverage, Google searches, SEC downloads, SEC comment letters, shareholder proposals, analyst coverage, and lawsuits increase following inclusion. Post-inclusion performance falls and is negatively related to the increase in attention. Included firms’ investment and payout policies become more similar to those of index peers and the increase in similarity is positively related to the size of the attention increase

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Year of publication:	2023
Authors:	Bennett, Benjamin ; Stulz, René M. ; Wang, Zexi
Publisher:	[S.l.] : SSRN
Subject:	Public attention \| S&P 500 index addition \| analyst coverage \| investment \| dividends \| share repurchases \| Finanzanalyse \| Financial analysis \| Dividende \| Dividend \| Aktienrückkauf \| Share repurchase \| Unternehmenserfolg \| Firm performance \| Börsenkurs \| Share price

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Extent:	1 Online-Ressource (82 p)
Series:	Fisher College of Business Working Paper ; No. 2023-03-001
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Arbeitspapier ; Working Paper ; Graue Literatur ; Non-commercial literature
Language:	English
Notes:	Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments January 9, 2023 erstellt
Other identifiers:	10.2139/ssrn.4321191 [DOI]
Classification:	G24 - Investment Banking; Venture Capital; Brokerage ; G31 - Capital Budgeting; Investment Policy ; G32 - Financing Policy; Capital and Ownership Structure ; G35 - Payout Policy
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10014254992