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New research on the financial services industry from Harvard Business School faculty on issues including hedge funds, venture capital, and financial regulation.
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Layoffs Can Be Bad Business: 5 Strategies to Consider Before Cutting Staff

by Ben Rand

Many companies are quick to reduce headcount when economic headwinds appear, but they risk weakening their businesses. A case study by Sandra Sucher explores the hidden costs of layoffs.

How Can Financial Advisors Thrive in Shifting Markets? Diversify, Diversify, Diversify

by Ben Rand

Financial planners must find new ways to market to tech-savvy millennials and gen Z investors or risk irrelevancy. Research by Marco Di Maggio probes the generational challenges that advisory firms face as baby boomers retire. What will it take to compete in a fintech and crypto world?

After Silicon Valley Bank's Flameout, What's Next for Entrepreneurs?

by Avery Forman

Silicon Valley Bank's failure in the face of rising interest rates shook founders and funders across the country. Julia Austin, Jeffrey Bussgang, and Rembrand Koning share key insights for rattled entrepreneurs trying to make sense of the financing landscape.

Equity Bank CEO James Mwangi: Transforming Lives with Access to Credit

Re: Caroline M. Elkins

James Mwangi, CEO of Equity Bank, has transformed lives and livelihoods throughout East and Central Africa by giving impoverished people access to banking accounts and micro loans. He’s been so successful that in 2020 Forbes coined the term “the Mwangi Model.” But can we really have both purpose and profit in a firm? Harvard Business School professor Caroline Elkins, who has spent decades studying Africa, explores how this model has become one that business leaders are seeking to replicate throughout the world in her case, “A Marshall Plan for Africa': James Mwangi and Equity Group Holdings.” As part of a new first-year MBA course at Harvard Business School, this case examines the central question: what is the social purpose of the firm?

What Happens When Banks Ditch Coal: The Impact Is 'More Than Anyone Thought'

by Barbara DeLollis

Bank divestment policies that target coal reduced carbon dioxide emissions, says research by Boris Vallée and Daniel Green. Could the finance industry do even more to confront climate change?

The Best Person to Lead Your Company Doesn't Work There—Yet

by Rachel Layne

Recruiting new executive talent to revive portfolio companies has helped private equity funds outperform major stock indexes, says research by Paul Gompers. Why don't more public companies go beyond their senior executives when looking for top leaders?

Is Amazon a Retailer, a Tech Firm, or a Media Company? How AI Can Help Investors Decide

by Danielle Kost

More companies are bringing seemingly unrelated businesses together in new ways, challenging traditional stock categories. MarcAntonio Awada and Suraj Srinivasan discuss how applying machine learning to regulatory data could reveal new opportunities for investors.

As Climate Fears Mount, More Investors Turn to 'ESG' Funds Despite Few Rules

by Rachel Layne

Regulations and ratings remain murky, but that's not deterring climate-conscious investors from paying more for funds with an ESG label. Research by Mark Egan and Malcolm Baker sizes up the premium these funds command. Is it time for more standards in impact investing?

What Does the Failure of Silicon Valley Bank Say About the State of Finance?

by Dina Gerdeman

Silicon Valley Bank wasn't ready for the Fed's interest rate hikes, but that's only part of the story. Victoria Ivashina and Erik Stafford probe the complex factors that led to the second-biggest bank failure ever.

What Would It Take to Unlock Microfinance's Full Potential?

by Jen McFarland Flint

Microfinance has been seen as a vehicle for economic mobility in developing countries, but the results have been mixed. Research by Natalia Rigol and Ben Roth probes how different lending approaches might serve entrepreneurs better.

ESG Activists Met the Moment at ExxonMobil, But Did They Succeed?

by Lane Lambert

Engine No. 1, a small hedge fund on a mission to confront climate change, managed to do the impossible: Get dissident members on ExxonMobil's board. But lasting social impact has proved more elusive. Case studies by Mark Kramer, Shawn Cole, and Vikram Gandhi look at the complexities of shareholder activism.

The Color of Private Equity: Quantifying the Bias Black Investors Face

by Pamela Reynolds

Prejudice persists in private equity, despite efforts to expand racial diversity in finance. Research by Josh Lerner sizes up the fundraising challenges and performance double standards that Black and Hispanic investors confront while trying to support other ventures—often minority-owned businesses.

Buy Now, Pay Later: How Retail's Hot Feature Hurts Low-Income Shoppers

by Rachel Layne

More consumers may opt to "buy now, pay later" this holiday season, but what happens if they can't make that last payment? Research by Marco Di Maggio and Emily Williams highlights the risks of these financing services, especially for lower-income shoppers.

What Does It Take to Safeguard a Legacy in Asset Management?

by Rachel Layne

Diverse hiring, deep research, and a collaborative culture have defined Brown Capital's successful investment approach. But would those qualities endure after its founder retires? A case study by Luis Viceira and Emily McComb explores how the second-largest Black-founded investment firm is preparing for its next phase.

Shrinking the Racial Wealth Gap, One Mortgage at a Time

by Rachel Layne

If banks hire more minority loan officers, more people of color might tap into a crucial means of wealth building: buying a home. Research by Adi Sunderam comes on the heels of a real estate frenzy that has mostly benefited white Americans.

Cold Call: Corporate Governance and Growth Strategy at Capital SAFI

Re: V.G. Narayanan

Jorge Quintanilla Nielsen started the independent asset management firm Capital SAFI in 2007. Now a leader in Bolivia’s closed-end funds industry with a total of $430 million in assets under management, Quintanilla planned to expand into other countries, like Peru and Colombia. He knew that governance would be one of the main aspects potential partners would evaluate. Capital SAFI’s board had evolved over time with the establishment of a governance committee, an assessment process for the board, professional development offerings for board members, tools to manage governance risk, and succession plans for board members and company executives. Would local and foreign investors be impressed by those measures or were additional improvements needed? Professor V. G. Narayanan discusses the importance of corporate governance in his case, “Building the Governance to Take Capital SAFI to the Next Level.”

Larry Fink at BlackRock: Linking Purpose to Profit

Re: George Serafeim

In 2014, Larry Fink started writing letters to the leaders of some of the largest publicly listed companies, urging them to consider the importance of environmental, social, and governance (ESG) issues. Fink is the chairman and CEO of BlackRock, one of the largest asset management houses in the world. The firm’s success was rooted in its cost-effective, passive investment products that rely more on tracking indices and funds. But Fink wanted his firm to engage with the companies in which they invest and hold them accountable for their social and environmental impacts. What role should investors play in urging business leaders to take environmental, social, and governance issues more seriously and enforcing compliance? Harvard Business School professor George Serafeim discusses the merits of Fink’s approach, the importance of corporate investments in ESG themes, and how to lead a company driven by purpose and profit in his case, “BlackRock: Linking Purpose to Profit,” and his new book Purpose and Profit: How Business Can Lift Up The World.

Did Pandemic Stimulus Funds Spur the Rise of 'Meme Stocks'?

by Rachel Layne

Remember the GameStop stock frenzy? Research by Robin Greenwood and colleagues shows how market speculation can flare up when you combine stimulus funds, trading platforms, and plain old boredom.

After the 'Crypto Crash,' What's Next for Digital Currencies?

by Christina Pazzanese, Harvard Gazette

After soaring to dizzying levels, Bitcoin and other cryptocurrencies have lost more than half of their value in recent months. Scott Duke Kominers discusses crypto's volatility, potential for regulation, and why these digital assets are likely here to stay.

Scaling a Fintech Startup for the Greater Good

Re: Emily Williams

Esusu launched in 2018 with a rotational savings product and continued growing their fintech startup in late 2019 with Esusu Rent, a rent reporting tool that enables renters to improve their credit scores. In March 2020, co-founders Abbey Wemimo and Samir Goel were working to determine how best to scale Esusu to advance their mission of promoting financial inclusion in the US. Harvard Business School Assistant Professor Emily Williams discusses how the two co-founders decided how to allocate resources and scale their business in the case, “Esusu: Solving Homelessness Backwards.”