Bridging Troubled Waters
The non-profit Center was founded in 2006 to support policy research for investors, intermediaries and regulators. We help facilitate research projects and aid the understanding of institutions and practices which affect the efficiency of markets.
The Center forms a bridge between research facilities in the financial and academic communities. Most projects are designed to evaluate the impact of changes in market efficiency which result from actions of practitioners and regulators.
We provide qualified researchers with confidential, but cloaked market activity data from market intermediaries, together with financial stipends and access to expert practitioners.
Borrowed Proxy Abuse
In 2006, a team of academic researchers claimed to find evidence of “vote buying” and manipulation of corporate governance in the securities lending markets. Their studies claimed that spikes of lending activity on proxy record dates proved unequivocally that abuse by share borrowers was “widespread” and, further, that control of voting rights could be acquired at no cost. The most frequently cited studies were sharply critical of securities lending, alleging that activist hedge funds were borrowing securities from naive institutional investors in order to dictate the outcome of contested proxy votes, often to the disadvantage of the lenders. These charges created headline news, not just in financial journals but also in mass media outlets. How valid were their charges? read more