Our Stakeholder Capitalism Grand Challenge Final Report, written by Executive Director Greg Brown and Chief Economist Gerald Cohen, has been published in the Spring 2023 issue of the Journal of Applied Corporate Finance.
Rodney E. Hood, National Credit Union Administration board member, discusses recent ESG-related legislation and the role governments can play during a panel at the February 2023 Frontiers of Business Conference.
Plastic is used in products across nearly every consumer goods sector, but plastic goods carry large negative external costs. Individuals may ask what power they have to create change, but history shows they can use their power as consumers.
CEO pay is the latest point of contention in the political fight over ESG, but the arguments have become oversimplified. When we think about good corporate governance, what does the evidence say about CEO pay? The results may surprise you.
For some years now, environmental, social and governance investing has stormed the asset management industry with explosive growth. Tighter and increased oversight may finally bring it back down to earth.
Students from UNC Kenan-Flagler Business School, in partnership with UNC's Program for Public Discourse, will gather to address the opportunities and risks of an environmental, social and corporate governance (ESG)-centered approach to financial decision-making.
Our 2023 Frontiers of Business Conference will convene top researchers, corporate executives and policy leaders working around the globe to navigate the balance of corporate value and values. Join us as our experts share objective, evidence-based solutions for implementing stakeholder capitalism and ESG frameworks more broadly.
For our 2022 grand challenge, the Kenan Institute made the ambitious commitment to explore stakeholder capitalism and ESG investing – complex topics that have required the engagement of our global network of experts to unpack.
Executive Director Greg Brown offers a simple model for prioritizing ESG issues at smaller PE-backed companies, given that the trade-offs between benefits and costs of implementation are more likely to limit the scope of their policies.
UNC Kenan-Flagler Business School Clinical Associate Professor of Finance Arzu Ozoguz discusses the SEC's anticipated new rules around sustainability.
We Are All Human founder Claudia Romo Edelman talks with the Kenan Institute about why diversity matters for both employers and employees, and how Hispanic workers in particular are navigating their relationship to the workforce after the pandemic.
In a Financial Times article on paying executives in the age of stakeholder capitalism, UNC Kenan-Flagler Business School Professor Camelia Kuhnen notes that performance-related compensation packages can have negative consequences.
Moving to a clean economy will require innovation across the board, said MIT Sloan School of Management’s Jacquelyn Pless, a Kenan Institute Distinguished Fellow, but it shouldn’t be presumed that environmental policy and the economy are at odds.
Research indicates that groups are most effective at achieving gender equity goals when men and women advocate together.
Can investing in polluting industries be a tool for fostering sustainability? Yes, according to research by Kenan Institute Distinguished Fellow Jacquelyn Pless, and it may be more effective than divesting.
Kenan Institute Distinguished Fellow Lubos Pastor of the University of Chicago Booth School of Business weighs in on the significant increase in ESG investing over the past decade, as well as the causes and implications of that going forward.
Pless, a Kenan Institute Distinguished Fellow, will discuss the degree to which divestment versus continued investment in polluting industries might help drive the transition to a cleaner economy.
Kenan Institute Distinguished Fellow Emmanuel Yimfor of the University of Michigan Ross School of Business tells leaders that when there are no win-win solutions among stakeholders, it’s important to explain the issues that are at the heart of stakeholder capitalism.
Pastor, a Kenan Institute Distinguished Fellow, will discuss how green stocks — despite outperforming brown in recent years because of an unexpectedly strong increase in environmental concerns — have lower expected future returns than brown.
There are few topics in business more current, more covered or more controversial than corporate environmental, social and governance (ESG) responsibilities. Proponents claim a business’s adoption of such principles yields outcomes that benefit all parties, driving win-win scenarios for internal and external stakeholders alike. But critics dismiss ESG implementation as a performative PR ploy, and argue that considering such non-pecuniary factors in corporate decision-making is unsustainable. Our (independent, nonpartisan) findings indicate both sides of the debate are missing the mark – and in hopes of advancing more productive conversations, we introduce below a research-based model for examining the trade-offs of ESG adoption for businesses large and small.
UNC Kenan-Flagler Business School Professor Camelia Kuhnen was among a group of economists who answered questions for a survey on stakeholder capitalism by the Initiative on Global Markets at the University of Chicago Booth School of Business. Considering one statement – “Effective mechanisms for boards of directors to ensure that CEOs act in ways that balance the interests of all stakeholders would be straightforward to introduce” – Kuhnen objected strongly
Patagonia founder Yvon Chouinard and his family will transfer ownership of the company – valued at roughly $3 billion – to two newly created environmental trusts. In this Kenan Commentary, we ask four questions to determine how Chouinard’s move fits into the framework of the institute’s annual theme, stakeholder capitalism, and whether a better comparison is the laudable but more common idea of an altruistic business owner.
A new personal gift from Bruce Van Saun, Citizens Financial Group Inc. chairman and CEO, and his wife, Kathleen (Katie) Van Saun, will support the Kenan Institute’s annual grand challenge. Starting in 2023, the three-year gift will support the institute’s Distinguished Fellows, who advance thought leadership around the grand challenge’s theme, a key issue that affects business and society. The program is making its debut this year with an exploration of stakeholder capitalism and ESG investing. The Van Sauns earned their MBAs from UNC Kenan-Flagler Business School in 1983 and were married in 1985.
Yimfor, a Kenan Institute Distinguished Fellow, will discuss his recent work on how access to venture capital varies by the founder’s race and alma mater and explore mechanisms driving the variation.
Some analysis indicates companies with diverse executive teams drive more revenue and are more likely to experience higher profits relative to their nondiverse peers, yet founding teams for both high-growth startups and the private capital groups that fund them stand in stark contrast to the U.S. working age population. Why? And why should it matter? In this week’s Kenan Insight, Kenan Institute Distinguished Fellow Emmanuel Yimfor unpacks statistics on the composition of both high-growth startups and private capital groups, explores the economic and societal implications of their lack of diversity and provides suggestions to facilitate change.
The argument that ESG investing generates more stable and higher long-term returns has come under scrutiny, including recent data showing long-run underperformance of ESG funds over the past five years. In this Kenan Insight, we provide some clarification based on recent research that revisits fundamental questions: why and how some investors take ESG factors into account in the first place.
Participants at this year's Alternative Investments Conference discuss how ESG metrics have evolved over the past decade.
Participants at this year's Alternative Investments Conference give their thoughts on the recent public focus on ESG.
A panel from this year's Alternative Investments Conference discusses how venture capital is playing catch-up on ESG investing, "knowing what levers you can pull," and the opportunity for huge growth in this week's Kenan Insight.
Participants at this year's Alternative Investments Conference discuss the increasing importance of ESG in their organizations and to investors.
Pete Stavros of KKR & Co. founded Ownership Works, a new initiative backed by 19 private equity firms, with the objective of reducing income inequality by increasing employee share ownership. The group has prominent backers and a lofty goal of creating $20 billion in wealth in 10 years. As a researcher who has worked on employee share ownership and the benefits it can create, I was encouraged by the news. But while I broadly support employee ownership, such initiatives also can raise red flags because of the risk they impose on employees. As such, it is worthwhile to think carefully through what we know and don’t know about such programs.
Further embracing renewable energy sources can help in the long term, but short- and medium-term solutions will require other answers. Join us for a virtual discussion at 11 a.m. June 20 as Stephen Arbogast, Kenan-Flagler Business School Finance Professor and director of the Energy Center, talks with Chief Economist Gerald Cohen about how focusing on the global energy supply can help Europe select the best options for creating a more stable energy outlook.
UNC Kenan-Flagler Business School Professor Al Segars and co-author Anselm Beach have written about their new model for developing diversity, equity and inclusion in an organization, the Values/Principles Model, in the most recent issue of the MIT Sloan Management Review. At a time when recognition of DEI’s benefits has become widespread, their approach gives leaders the tools to create real change that will allow their whole companies to prosper. Learn more by clicking below.
There’s no escaping the growing interest in environmental, social and corporate governance investing, but not everyone agrees on how to define, measure or report the variety of factors considered under ESG. Professor Laura Starks of the University of Texas McCombs School of Business spoke on the subject in May at the Alternative Investments Conference, sponsored by the Institute for Private Capital. Starks’ keynote speech, highlighted here, examined the knowns and unknowns of ESG investing as well as new regulations that may be coming.
Mark Little, executive director of the Kenan Institute-affiliated center CREATE, provided expert testimony in a process that resulted in a May 11 settlement agreement regarding contracting and hiring practices for Dominion Energy’s $9.8 billion Coastal Virginia Offshore Wind renewable energy project.
London Business School Professor Alex Edmans, a 2022 Kenan Institute Distinguished Fellow, followed up his recent virtual presentation on “The Power of Purposeful Business” by answering key questions from the audience. This week’s Kenan Insight offers a curated Q&A with a few of our favorites, with Professor Edmans tackling topics such as which issues government is best equipped to regulate and which may require shareholders to step in, the limits of using data in ESG measurement, and how best to encourage purposeful thinking throughout an organization.
The explosive growth in ESG investing has created confusion among investors. As part of our yearlong series on stakeholder capitalism, we unpack what they should expect from ESG and try to reconcile it with both financial theory and empirical evidence. The bottom line is a bit complicated.
The Frank Hawkins Kenan Institute of Private Enterprise is thrilled to announce its 2022 class of Distinguished Fellows. Appointed on an annual basis, the Distinguished Fellows comprise an exemplary set of global scholars committed to leveraging their individual expertise, thought leadership, research and networks to further the institute’s efforts to examine and drive solutions to issues facing business and the economy today.
Purpose is the corporate buzzword of today, with politicians, the public and even shareholders calling on businesses to serve wider society. But purpose is also controversial, because companies have a responsibility to deliver returns to investors. Is there a trade-off between purpose and profit, or is it possible for companies to achieve both? The Kenan Institute of Private Enterprise hosted a virtual talk featuring London Business School Finance Professor Alex Edmans, who critically examined the case for purposeful business using rigorous evidence and real-life examples to show what works – and, importantly, what doesn’t. He discussed practical ways for businesses of all sizes to put purpose into practice, how investors and citizens can play their part, and how we can distinguish businesses that are truly purposeful from those that are greenwashing.
Hear from Kenan Institute and affiliated experts about why the time is now for a deep-dive exploration of stakeholder capitalism and ESG investing – forces which have already begun shaping business and economic outcomes on a global scale.
Join the Kenan Institute of Private Enterprise for a virtual talk featuring London Business School Finance Professor Alex Edmans, who will critically examine the case for purposeful business using rigorous evidence and real-life examples to show what works – and, importantly, what doesn’t.
The Kenan Institute’s deep dive into stakeholder capitalism has exposed shortcomings in a key building block: ESG measurement. Our experts have explored the issue at length, proposing ways of refining these measures to produce structures that could meet the needs of multiple stakeholders while also working to design reporting free from political influence and agendas. As a next step, the Kenan Institute hosted a conversation featuring a business leader, investor and standard setter to discuss how we might turn these ideas into solutions to help integrate stakeholder capitalism principals into business and investment decisions.
The Kenan Institute’s deep dive into stakeholder capitalism has exposed shortcomings in a key building block: ESG measurement. In this one-hour virtual session, we will convene a cross-sector group of panelists to discuss why ESG measurements matter to businesses large and small. The panelists will offer recommendations on scalable implementation, suggest how best to leverage such measures to meet the needs of different stakeholder groups, and provide tips on how to design reporting that is free from political influence and agendas.
The idea of the Federal Reserve using monetary policy to help mitigate climate risk has gained traction in some circles, but Director of Research Christian Lundblad writes in a new piece for Fortune that such a shift would come with its own set of risks. In addition, nothing the Fed might do would change the fact that Congress must lead any governmental response to climate change.
With a recent report from the United Nations warning that climate change has already begun to cause irreversible damage, experts during the 2022 Kenan Institute Frontiers of Entrepreneurship Conference discussed the role innovation can – and should – be playing to combat these ill effects. This week’s insight explores the topic through Q&A with Dr. Eric Toone, executive managing director and technology lead at Breakthrough Energy Ventures, and Dr. Jacqueline Pless, the Fred Kayne (1960) Career Development Professor of Entrepreneurship at MIT Sloan School of Management.
Together with many business and economic leaders around the globe, we at the Kenan Institute of Private Enterprise support the harshest feasible sanctions against Vladimir Putin in the immediate interest of Ukraine and its people. More broadly, we view such measures as vital to the long-term survival of democratic values. But as the Russian invasion continues, seemingly unabated by unprecedented economic and financial sanctions, we must ask: what more is feasible? And for how long can such restrictions be sustained?
ESG measurement and impact accounting can have vast economic and social influence; however, implementation is extremely challenging for both businesses and policymakers. In this week’s insight, our experts propose ways of refining ESG measures to produce structures that meet various stakeholder needs, drive reporting free from political influence and agendas, and illustrate the promise and risks of impact accounting.
As part of President Joe Biden’s efforts to refocus the Federal Reserve Board, the Senate conducted confirmation hearings for several nominees this past week. While these hearings traditionally raise spirited exchanges about the nominees’ views on monetary policy and bank supervision, a new and more controversial topic involves the extent to which the Federal Reserve should internalize climate risks into its purview. Before wading into central bank wonkishness, it is important to make clear that climate change represents a serious risk to not only the U.S. economy but to humanity itself. Nevertheless, we need to be very deliberate in the assessment of the available policy tools, with an eye to where unintended consequences may reside.
Greater focus on social justice has brought systemic inequities in the corporate sector to light, leading companies to step up their efforts in attracting and retaining a diverse workforce – but many challenges remain in implementing those goals. Following a joint report between the Kenan Institute and EY, this week’s Kenan Insight breaks down some challenges companies may face while trying to reach their diversity, equity and inclusion goals.
As we begin the new year, we wanted to highlight five topics, beyond the impact of COVID-19 and related uncertainties, that we believe business leaders and policymakers will be grappling with in 2022. Throughout the year, we will focus our efforts to provide solutions-focused analysis on these topics as well as a host of others.
As we begin the new year, we wanted to highlight five topics, beyond the impact of COVID-19 and related uncertainties, that we believe businesspeople and policy makers will be grappling with in 2022. Throughout the year, we will focus our efforts to provide solutions-focused analysis on these topics as well as a host of others.
Stakeholders can and should play an important role in business decisions, but how can their interests be incorporated into business practices to create win-win solutions? In this week’s Insight, our experts dive into this question and discuss whether stakeholder capitalism models can help us find the right solution.
A look at stakeholder capitalism – the idea that businesses would improve societal outcomes by focusing on a mandate broader than that which benefits shareholders alone – starts with the existing best-practice model: shareholder capitalism. This model, while not perfect, can produce the optimal amount of goods and services at the lowest cost. This week, Kenan Institute experts explore ways to improve it and examine whether stakeholder capitalism is ready to take its place.
Former Kenan Institute Center for Sustainable Enterprise Research Associate and current ACTIVEST Co-founder Napoleon Wallace's latest project was recently featured in a New York Times DealBook newsletter piece. The article discusses the rating system his company is developing, . . .