I compare issuer-paid ratings, represented by Standard & Poor's (S&P) to investor-paid ratings, represented by Egan-Jones Ratings Company (EJR), after the passage of the Dodd-Frank Act. My results show that S&P ratings are lower than EJR ratings in the post-Dodd-Frank period, especially for firms able to generate revenue to credit rating agencies (CRAs); i.e., firms with a large bond issuance, larger firms, and low-performing firms. Further, I find evidence of a greater accuracy of S&P ratings relative to EJR ratings in the post-Act period as shown by the lower probability of large credit rating changes and rating reversals. Finally, I show that issuer-paid ratings are more concerned about providing timely ratings in the post-Dodd-Frank period, thus protecting their reputation as leading information providers, than investor-paid ratings. My results are robust to a wide battery of robustness tests.

We examine the impact of economic policy uncertainty on trade credit. We document a decline (increase) in accounts payable, receivable, and net credit during periods of high (low) policy uncertainty and that firms react quickly to changes in uncertainty. The relation is long-term and holds after controlling for endogeneity, non-policy economic and political uncertainties, and the Great Recession. Industry competitiveness, proxied by firm market power, moderates the impact of economic policy uncertainty on trade credit. Uncertainty about monetary and fiscal policies, taxes, and regulations are the major drivers of trade credit changes. The reduction in trade credit during periods of increasing uncertainty can be explained by financial distress, constraints, and relation-specific investment channels.

We examine the impact of employee-related Corporate Social Responsibility (ER-CSR) on pay disparity between top management and the average worker. Firms with higher ER-CSR ratings have a lower pay disparity and the effect is greatest when executives are paid the most. ER-CSR is associated with a lower ratio of top management's cash and long-term incentive compensation, relative to the average employee's pay. We find that the negative relation is driven by socially responsible firms paying their average employees more. Finally, we document that CSR activities related to employee relations and diversity are those leading to a significant pay disparity reduction.

We document that firms run by female executives are associated with a significantly greater value for their cash holdings. In these firms, the marginal value of one dollar is 1.39, while the comparable value is 0.90 for male managed firms. Further, the marginal value of cash holdings for firms run by female CEOs (CFOs) is 1.56 (1.47) compared to 0.94 (0.91) for firms with male CEOs (CFOs). The significant difference in the value of cash holdings may be attributed to the gender-based female executives’ traits that permeate a myriad of corporate decisions with superior outcomes that cumulatively manifest in the market assigning a higher value to cash holdings by these firms. The effect is more pronounced in firms with any of the following characteristics: financially unconstrained, cash distributing, weak governance, low institutional investors’ monitoring, and low audit quality. Adding another new dimension to the literature, we show that corporate culture is a potential determinant of the value of cash holdings. Specifically, we document that female led firms are associated with a more salubrious corporate environment manifesting in a greater value assigned to corporate cash holdings. Our results are robust to a battery of robustness tests.

This study establishes a relation between corporate culture and debt maturity choice. Specifically, superior corporate culture is associated with the choice of shorter-term debt, supporting the notion that superior culture reduces managerial agency problems resulting in managers being more receptive to external monitoring through the choice of shorter-term debt. The culture subcomponents of integrity, teamwork, and innovation are found to have a meaningful influence on the debt maturity structure choice. The relation between culture and debt maturity is more pronounced in firms with higher managerial stock ownership and those that are financially constrained, but is weakened in firms with a greater CEO sensitivity to stock prices. Additionally, firms with superior culture are shown to have higher long-term credit ratings. These findings contribute at the confluence of corporate culture and debt financing literatures. A battery of robustness tests, including addressing endogeneity concerns, validate the findings.

Gender diversity in the C-suite and the boardroom have taken on greater importance in recent years. We establish a gender-based behavioral dimension to corporate debt maturity choice. Female executives choose a significantly shorter debt maturity structure compared to their male counterparts. However, their influence on debt maturity is inversely related to the proportion of their incentive compensation. Additionally, we find a substitution effect that moderates the relationship between executive gender and debt maturity structure as board gender diversity increases. Further, we find that firms led by females benefit from higher corporate credit ratings thus showing that the greater ethical sensitivities of female top executives compensate for the refinancing risk commonly associated with shorter-term debt. Transitions from male-to-female executive(s) result in shortening of debt maturity over the post-transition period. Our results survive a battery of robustness tests, including endogeneity, and contribute at the confluence of gender-based governance and corporate financial decision-making literatures.