Corporate Governance Matters

The Definitive Guide to High-Performance Corporate Governance


Fully updated for the latest research, trends, and regulations, Corporate Governance Matters, Third Edition, offers comprehensive and objective information for everyone seeking to improve corporate governance--from directors to institutional investors to policymakers and researchers.


To help you design highly effective governance, David Larcker and Brian Tayan thoroughly examine current options, reviewing what is and isn't known about their impact on organizational performance. Throughout, they take a strictly empirical and non-ideological approach that reflects rigorous statistical and research analysis and real-life examples. They address issues ranging from board structure, processes, operations, and functional responsibilities to institutional investors, outside stakeholders, and alternative forms of governance.


New discussions of:

• Environmental, Social, and Governance (ESG) activity and ratings
• Stakeholder interests
• CEO activism
• CEO misbehavior
• Cybersecurity risks

Extensively revised coverage of:

• Executive compensation
• Leadership and succession planning
• Director recruitment, evaluation, turnover, and more

David Larcker is James Irvin Miller Professor of Accounting at the Graduate School of Business of Stanford University; Director of the Corporate Governance Research Program; Senior Faculty, Arthur and Toni Rembe Rock Center for Corporate Governance. His research focuses on executive compensation, corporate governance, and managerial accounting, examining the choice of performance measures and compensation contracts in organizations. His current research projects address the valuation implications of corporate governance, the impact of proxy advisory firms on shareholder proxy voting, and modeling the cost of executive stock options.
Brian Tayan is a member of the Corporate Governance Research Program at the Stanford Graduate School of Business. He has written broadly on the subject of corporate governance, including boards of directors, succession planning, executive compensation, financial accounting, and shareholder relations. Previously, he worked as a financial analyst at Stanford University's Office of the CEO and as an investment associate at UBS Private Wealth Management. He has actively managed a private investment partnership since 2006, specializing in long-term, conservative growth through equity investments. Tayan received his MBA from the Stanford Graduate School of Business and his BA from Princeton University.

1. Introduction to Corporate Governance 2. International Corporate Governance 3. Board of Directors: Duties and Liability 4. Board of Directors: Selection, Compensation, and Removal 5. Board of Directors: Structure and Consequences 6. Strategy, Performance Measurement, and Risk Management 7. Labor Market for Executives and CEO Succession Planning 8. Executive Compensation and Incentives 9. Executive Equity Ownership 10. Financial Reporting and External Audit 11. The Market for Corporate Control 12. Institutional Shareholders and Activist Investors 13. Corporate Governance Ratings 14. Alternative Models of Governance 15. Summary and Conclusions