Enterprise Risk Management (ERM) is a program that manages all firm risks in an integrated framework to control and coordinate offsetting risks. In this study, I provide the first archival evidence on how ERM affects firms' day-to-day, routine operations. Using hand-collected ERM adoption data and inventory information, I examine whether firms with an ERM program experience an improvement in their inventory management. My findings suggest that ERM adoption is associated with greater inventory turnover ratios and lower inventory impairments. These results are robust to a range of models in addressing endogeneity concerns. Additionally, I find that ERM's effect on inventory management is stronger among firms with greater financial distress, with less investments in innovation, or with higher information asymmetries, and when firms' ERM program grows more mature. My study documents ERM's real economic benefits to firms' operations and highlights how ERM contributes to operating performance.

This paper investigates the determinants of mutual fund portfolio manager ownership and its association with fund performance. Using hand-collected data of 1,420 U.S. equity funds from 32 fund families, we find that variations in fund manager holdings are broadly consistent with optimal contracting theory instead of the result of managers' personal investment consideration. Portfolio manager ownership is positively and significantly correlated with variables that proxy for intensity of agency conflicts. Specifically, portfolio managers hold more mutual fund shares when the size of concurrently managed hedge fund increases and when the advisor is affiliated to the bank. In addition, fund managers invest more in funds with primary investment in growth stock, non-index funds, and solo-managed funds. Regarding to the alternative governance mechanism, higher threat of dismissal for outsourced funds, stronger monitoring from institutional investors, and long-term performance based bonus work as substitutes of fund manager ownership while director ownership works as a compliment. Finally, we find little evidence supporting the notion that funds with higher portfolio manager ownership perform better.

Access to adequate liquidity to finance future investments is an essential element of financial management. The two main questions that this dissertation attempts to answer are (i) what is the net valuation effect of LoC? and (ii) if LoC create value, what are the sources of this value? To answer these questions, I constructed a sample of 85,232 firm-years spanning from 1993 to 2016, with credit line data obtained from Capital IQ and Bloomberg. I investigated the valuation effects of LoC with a methodology extensively used in the analysis of the valuation implications of cash. I used this methodology because cash and LoC are two alternatives to manage liquidity and estimated the changes in shareholders' value associated with changes in existing LoC undrawn balances and on new LoC agreements. The results from this analysis demonstrates a positive association between increases in LoC capacity and shareholder's value. These findings are also obtained in univariate and event study analyses. The results also suggest that LoC create more value for firms that are rich in cash, indicating the LoC and cash are complementary liquidity management tools. I then focused on the sources of the value created by credit lines. I examined whether information …

The dissertation analyzes three issues related to corporate environmental performance. In the first essay, I analyze the stock price reactions of the defendant firms and their peer firms to environmental lawsuits. Empirical evidence finds that the defendant and their peer firms experience negative and significant cumulative abnormal returns to the announcement of environmental lawsuits. Additionally, cross-sectional analyses find certain firm characteristics, such as profitability, growth opportunities and leverage can influence the market reaction. Furthermore, if the plaintiffs are government agencies or corporations instead of individual citizens, the defendant and peer firms experience higher negative market reactions. The second essay examines if a firm's environmental, social, and governance (ESG) performance can moderate the negative market response to environmental lawsuits. The results are mixed. The overall sample of the defendant and their peer firms show that ESG performance is not a significant factor in mitigating the negative market response. However, an interesting finding shows, for defendant and peer firms in the environmentally sensitive industries, better ESG ratings help reduce the adverse market reactions. The final essay investigates whether the defendant and peer firms improve their ESG performance in the next two years following the lawsuits. The results indicates that firms generally experience …

Non-deal roadshows (NDR) are privately held one-on-one meetings between the buy-side of financial institutions and firm management. Using a novel dataset of these meetings, I examine the effects that NDR meetings have on the outcomes of two important corporate events: seasoned equity offerings (SEOs) and mergers and acquisitions (M&As). I also study the potential implications of the information content in NDRs on the behavior of stock returns following earnings announcements, which has been the subject of much academic work. I structure the dissertation in three essays. In the first essay, I examine the relationship between NDR activity and the underpricing of SEOs. I find that NDRs are associated with lower SEO underpricing. This association is stronger for firms with infrequent NDR activity, for smaller firms, and for firms with higher analysts' forecast errors. These findings suggest that NDRs reduce the level of asymmetric information between firms and investors, which results in a lower cost of raising equity. In Essay 2, I investigate whether the occurrence of NDR meetings affects post-earnings-announcement drift (PEAD). I find that PEAD declines after NDR activity when the most recent NDR meeting occurs within one month before the earnings announcement. This decline is most pronounced among …