Companies Should Maximize Shareholder Welfare Not Market Value

By Oliver Hart, Luigi Zingales. 2017

550 citations recorded by the source corpus.

Subfields: Accounting, Economics and Econometrics, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/62af51e26f569c6161aadd7ad5bef8d3182bb48f

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Citations in the corpus

Common Ownership, Competition, and Top Management Incentives (2016, unknown): “Recent research further suggests that institutional investors internalize broader goals of social responsibility (Hart and Zingales 2017; Oehmke and Opp 2019; Broccardo, Hart, and Zingales 2020; Coffee 2020), including climate change and race issues (Condon 2020; Krueger, Sautner, and Starks 2020;…”
Do Investors Value Sustainability? A Natural Experiment Examining Ranking and Fund Flows (2019, background): “As emphasized by Hart and Zingales (2017), investments for non-pecuniary pro-social reasons, such as sustainability, are something that companies should engage in if they re ect the preferences of their shareholders.”
The ESG-Innovation Disconnect: Evidence from Green Patenting (2020, unknown): “Moreover, Hart and Zingales (2017) argue that companies consider maximizing shareholder welfare, including environmental concerns, and not solely financial value - explicitly calling for active fund engagement rather than divestment.8 The equilibrium asset pricing implications of divestment have…”
Mandatory CSR and sustainability reporting: economic analysis and literature review (2019, background): “30 For instance, Hart and Zingales (2017) show that (prosocial) shareholder preferences affect optimal production decisions when externalities of these decisions are not perfectly separable.”
Firms and social responsibility: A review of ESG and CSR research in corporate finance (2021, background): “In particular, state-owned firms may be better positioned to deal with the market failures and externalities caused by such issues as has been hypothesized by Hsu, Liang, and Matos (2018) and Hart and Zingales (2017). On the other hand, governments and the firms they own could have other incentives ”
Sustainable investing in equilibrium (2019, unknown): “Hong and Kacperczyk (2009) find that “sin” stocks (i.e., stocks of public firms producing alcohol, tobacco, and gaming, which we would classify as brown) outperform non-sin stocks. They argue that social norms lead investors to demand compensation for holding sin stocks. Barber, Morse, and Yasuda (2”
A Theory of Socially Responsible Investment (2020, background): “In a pioneering contribution, Heinkel et al. (2001) show that firms that are excluded by socially responsible investors suffer a reduction in risk-sharing among their investor base. The resulting increase in the cost of capital can induce firms to clean up their activities.(3) Hart and Zingales (201”