Adam Smith Business School

Professor Mark Goergen. IE Business School

"Insider Trading in Connected Firms during Trading Bans"
Wednesday, 26 March 2025. 15:00-16:30
Room 487, Adam Smith Business School Building

Abstract

Insider Trading in Connected Firms during Trading Bans

Marc Goergen
Luc Renneboog
Yang Zhao

Insiders are subjected to trading bans or close periods before earnings announcements. Directors with multiple board seats can still trade in their other firms not subject to close periods. When a close period restricts insider trading, directors leverage insider information about that firm to trade in their other firms. This is supported by positive correlations between stock market reactions in close and traded firms, which are moderated by the type of firm relationships and institutional investor presence. This newly documented informational advantage, may encourage policymakers to apply the close period to all firms where a director holds board seats.

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5086405

Bio

Marc Goergen holds a DPhil in Economics from Oxford University, a master’s degree from Solvay Business School and a bachelor’s degree in economics from the Université Libre de Bruxelles. He is a full professor of finance at IE Business School, IE University, in Madrid. Previous appointments include UMIST and the Universities of Cardiff, Manchester, Reading and Sheffield. Marc is an Honorary Professor at Cardiff Business School, a Research Member of the European Corporate Governance Institute (ECGI) and a board member of the International Corporate Governance Society (ICGS). He is an associate editor of the British Accounting Review, the British Journal of Management, European Financial Management and the European Journal of Finance. Marc’s research interests are
corporate finance and corporate governance. His research papers have appeared in top academic journals, such as Entrepreneurship Theory and Practice, the Harvard Business Review, the Journal of Finance, the Journal of Financial Intermediation and the Journal of Corporate Finance. His research has also been covered by The Financial Times, The Times and WirtschaftsWoche. The second version of his successful textbook on corporate governance, entitled “Corporate Governance. A Global Perspective”, was published by Cengage in 2018

 

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First published: 26 February 2025