New York – Investors Responsibility Research Center Institute (IRRC) announced yesterday that it had sponsored a new venture with the recently announced Corporate Governance Network (CGN) — a service provided by the Social Science Research Network (SSRN). As such, the SSRN will bring together academic research in the area of corporate governance as a separate offering of the social science research portal. Because the arrangement has a number of moving parts, we will briefly describe the key players in the offering.
Social Science Research Network
The SSRN is an academic research portal for the social sciences. The subject areas span accounting, economics, financial economics, management, political science, to name a few. The addition of the Corporate Governance Network ensures that those interested in the latest academic research in the area of corporate governance will be able to locate papers written by the thought leaders in the field. CGN is directed by Lucian Bebchuk, William J. Friedman and Alicia Townsend Friedman Professor of Law, Economics, and Finance, and Director of the Corporate Governance Program, at Harvard Law School.
Integrity has not used the CGN for research projects yet, but has used the financial economics portion of the site to uncover new issues in equity research performance attribution. We found it to be a world class service for sourcing original, new and classic research papers that have been published in academic journals. In fact in the area of financial economics, the Board of Trustees includes Eugene Fama (Fama and French) –co-wrote one of the first multifactor models that included an analysis of B/V as an contradiction of the Security Market Line-Jenson’s Alpha and; William Sharpe-CAPM and the Sharpe Ratio.
CGN will start by following 21 subject matter eJournals and the subscription will be free until the fall of 2009. Because the area of corporate governance is so broad, the subject area will be further sub-divided into “Corporate Governance and”; Economics, Law, Finance, Management, Psychology, and many other topical subject areas. There will also be subject areas related to shareholder activism, mergers and acquisitions, bankruptcy and reorganizations.
Investors Responsibility Research Center Institute
The IRRC Institute is a not-for-profit institute provides information on corporate governance and social responsibility services, as well as proxy research and voting. While the firm has been around since 1972, it was purchased in 2006 by Institutional Shareholder Services (now a part of RiskMetrics). At that time the term “Institute” was added to its name. Institutional Shareholder Services, founded in 1985, was a firm dedicated to raising the bar for responsible proxy voting. Its key product was “Proxy Advisory Service” which it launched in 1986.
Over the past several years, RiskMetrics has executed one of the largest research provider roll-ups in the research space. Having started as a market risk analytical tool, sponsored by JP Morgan, the firm moved in the credit risk analysis shortly after this. RiskMetrics is a provider of risk management, corporate governance, financial research & analysis, and related services. Having been started by JP Morgan in 1994, the firm was spun off as a separate company in 1998. Subsequently, the firm has done a roll up of two research providers: 1) CFRA, a forensic accounting firm with expertise in legal and regulatory issues and 2) ISS, a corporate governance research shop with proxy services for fiduciaries. The firm’s core risk management products revolve around market risk and credit risk and encompass a wide range of markets, including equities, bonds, commodities, foreign exchange, futures, options, derivatives, structured products, interest-rate products, and credit products. These services include software and analytics, data, and managed services to help clients optimize the use of their capital, perform risk and return analysis, verify and evaluate securities, and meet regulatory requirements. The firm’s financial research and analysis products help clients evaluate financial/accounting risk, legal & regulatory risk, environmental & social risk, and corporate governance risk. The firm’s governance products include a range of services including proxy voting advisory, governance research and related products.
Impact of the CGN
With the analytical firepower the SSRN has, combined with the credentials of the ISS, the IRRC and RiskMetrics group, the Corporate Governance Network is expected to become the most widely used site for cutting edge information in corporate governance topics.