This study examines some economic and organizational changes resulting from the conversion of mutual thrift institutions (MTI) to publicly traded stock charter corporations. We focus on the relation between the initial value of the converted firm and (i) subscription decisions by management and by regular depositors, and (ii) the employment of a prestigious underwriter or auditor. Whereas the proportion of managerial subscriptions displays a convex relation with the firm's initial value, the relation between the regular depositor subscription and the converted firm's value is linear and positive. The status of the underwriter or auditor is unrelated to the value of the converted firm. These findings are attributed to the regulatory setting governing the MTI conversion process, constraints on ownership holdings and the oversight function of the regulator.

We examine executive turnover following environmental, antitrust, intellectual property (IP), and contractual lawsuits filed against their companies. We find that companies' responses to lawsuits depend on the nature of the allegations. In particular, contractual lawsuits are followed by increased turnover of CEOs and inside directors, whereas following environmental and IP lawsuits, only outside directors tend to depart. Antitrust lawsuits are followed by increased appointments of inside directors. We also find that lawsuit merit and pecuniary demands for damages play a role in determining executive turnover. In addition, we find some evidence of reduced CEO compensation following lawsuits. Overall, we provide insights into the effectiveness of the executive labor market in responding to alleged corporate wrongdoing.