F INANCE R ESEARCH S EMINAR S UPPORTED BY U NIGESTION “ Good monitoring , bad monitoring

Are courts effective monitors of corporate decisions? In a controversial landmark case, the Delaware Supreme Court held directors personally liable for breaching their fiduciary duties, signaling a sharp increase in Delaware‘s scrutiny over corporate decisions. In our event study, low-growth Delaware firms outperformed matched nonDelaware firms by 1% in the three day event window. In contrast, high-growth Delaware firms under-performed by 1%. Contrary to previous literature, we conclude that court decisions can have large, significant and heterogeneous effects on firm value, and that rules insulating directors from court scrutiny benefit the fastest growing sectors of the economy. Friday, November 23, 2012, 10.30-12.00 Room 126, 1st floor of the Extranef building at the University of Lausanne