Directors and Officers - Strategic Leadership or Bondage?

Directors' and Officers' Insurance and Shareholders' Protection

ASSOCIE A :. Institut de Finance Mathématique de Montréal (IFM 2). Laboratoires universitaires Bell Canada. Réseau de calcul et de modélisation mathématique [RCM 2 ]. Réseau de centres d'excellence MITACS (Les mathématiques des technologies de l'information et des systèmes complexes) Les cahiers de la série scientifique (CS) visent à rendre accessibles des résultats de recherche effectuée au CI...

Directors ’ and Officers ’ Insurance : Ordinary Corporate Expense or Valuable Signaling Device ?

After many years in which directors have used directors’ and officers’ (D&O) coverage to shield themselves from personal responsibility for corporate failure, directors at Enron and WorldCom have been forced to pay $31 million out of their own pockets to settle securities class action lawsuits stemming from two of the largest corporate governance scandals in U.S. history. These settlements have...

Directors’ and officers’ liability insurance and the cost of debt

Using hand-collected data on directors’ and officers’ liability insurance (D&O insurance), we analyze the effect of D&O insurance on the cost of debt. We find that higher levels of D&O insurance coverage are associated with higher at-issue bond yields (to maturity) and higher loan spreads. This evidence suggests that debtholders view D&O insurance coverage as increasing credit risk (potentially...

What Went Wrong with Directors' and Officers' Liability Insurance?

Directors' and officers' liability insurance and acquirer returns