Accounting & Management

- November–December 2021
- Article
Should We Embrace Crypto? (Case Study and Commentary)

By: Charles CY Wang
- November–December 2021
- Article
Should We Embrace Crypto? (Case Study and Commentary)

By: Charles CY Wang
- October 2021
- Case
The Opioid Settlement and Controversy Over CEO Pay at AmerisourceBergen

By: Suraj Srinivasan and Li-Kuan Ni

In 2020, AmerisourceBergen Corporation, a Fortune 50 company in the drug distribution industry, agreed to settle thousands of lawsuits filed nationwide against the company for its opioid distribution practices that critics alleged had contributed to the nationwide opioid crisis. The $6.6 billion global settlement, had caused a net loss larger than the cumulative net income earned under the current CEO since he took the helm in 2011. The legal troubles had been accompanied by initiatives by shareholder activists who had become increasingly successful in driving corporate governance changes in companies in the opioid supply chain, including AmerisourceBergen. Determined to hold the leadership accountable, these shareholders launched a campaign in early 2021 to reject the pay packages of the Company’s executives. They were protesting the increase in pay in 2020 to $13.3 million, up from $11.3 million in 2019. The result of the Vote NO campaign was almost split down the middle, with 48% voting with the activists and 52% with the company. The case describes the drug distribution industry, internal controls at Amerisource, shareholder demands on corporate governance, and the events related to the opioid crisis and Amerisource’s role in it. The case can be used for a wide range of teaching purposes to discuss issues relating to governance, compliance, executive compensation, and shareholder activism in the context of the one of the biggest social challenges of the past two decades—the opioid crisis.
- October 2021
- Case
The Opioid Settlement and Controversy Over CEO Pay at AmerisourceBergen

By: Suraj Srinivasan and Li-Kuan Ni

In 2020, AmerisourceBergen Corporation, a Fortune 50 company in the drug distribution industry, agreed to settle thousands of lawsuits filed nationwide against the company for its opioid distribution practices that critics alleged had contributed to the nationwide opioid crisis. The $6.6 billion global settlement, had caused a net loss larger than...
- October 2021
- Article
Directors' Perceptions of Board Effectiveness and Internal Operations

By: J. Yo-Jud Cheng, Boris Groysberg, Paul M. Healy and Rajesh Vijayaraghavan

We contribute to the growing literature on the effectiveness of corporate boards by examining the effect of two insights that have been largely unexplored in prior studies that use public data. First, since boards’ responsibilities are wide-ranging, more holistic performance measures may better capture the full range of their duties than specific public actions and outcomes (e.g., disclosure of risk management processes, financial restatements, acquisition returns, CEO turnover). And second, because corporate boards share many characteristics of other types of teams, their effectiveness is likely to be influenced by their internal operations. To examine the performance effects of these insights, we use data from 577 directors of U.S. public firms that responded to a survey we conducted in 2015–2016 and qualitative data from interviews of 75 directors. Our study establishes a strong relation between director perceptions of board performance effectiveness and internal board operations. Further, by highlighting the critical role of internal operations, identifying areas of relative strength and weakness in boards’ effectiveness in various activities, and probing director perceptions of their primary responsibilities, we are able to offer concrete suggestions for future research on board effectiveness.
- October 2021
- Article
Directors' Perceptions of Board Effectiveness and Internal Operations

By: J. Yo-Jud Cheng, Boris Groysberg, Paul M. Healy and Rajesh Vijayaraghavan

We contribute to the growing literature on the effectiveness of corporate boards by examining the effect of two insights that have been largely unexplored in prior studies that use public data. First, since boards’ responsibilities are wide-ranging, more holistic performance measures may better capture the full range of their duties than specific...

About the Unit

The Accounting & Management unit at Harvard Business School strives to be the worldwide leader in research, course development, and teaching on top managements' use of performance measurement systems to:

Communicate with external investors to ensure that their firms' securities are fairly priced and that they are able to access capital,
Measure and evaluate their firms' economic performance,
Improve resource allocation and strategy implementation within their firms, and
Build accountability for performance through effective external and internal governance.

Unit research, course development, and teaching fall into two broad areas: Financial Reporting and Analysis and Management Accounting. Our research helps scholars and educators understand current best practices for the design and use of performance measurement systems that help managers to build more effective, value-creating organizations. Our teaching materials enable us to bring the results of this research into the classroom, and to practice.

Recent Publications

Should We Embrace Crypto? (Case Study and Commentary)

By: Charles CY Wang

November–December 2021 |
Article |
Harvard Business Review

Citation

Read Now

The Opioid Settlement and Controversy Over CEO Pay at AmerisourceBergen

By: Suraj Srinivasan and Li-Kuan Ni

October 2021 |
Case |
Faculty Research

In 2020, AmerisourceBergen Corporation, a Fortune 50 company in the drug distribution industry, agreed to settle thousands of lawsuits filed nationwide against the company for its opioid distribution practices that critics alleged had contributed to the nationwide opioid crisis. The $6.6 billion global settlement, had caused a net loss larger than the cumulative net income earned under the current CEO since he took the helm in 2011. The legal troubles had been accompanied by initiatives by shareholder activists who had become increasingly successful in driving corporate governance changes in companies in the opioid supply chain, including AmerisourceBergen. Determined to hold the leadership accountable, these shareholders launched a campaign in early 2021 to reject the pay packages of the Company’s executives. They were protesting the increase in pay in 2020 to $13.3 million, up from $11.3 million in 2019. The result of the Vote NO campaign was almost split down the middle, with 48% voting with the activists and 52% with the company. The case describes the drug distribution industry, internal controls at Amerisource, shareholder demands on corporate governance, and the events related to the opioid crisis and Amerisource’s role in it. The case can be used for a wide range of teaching purposes to discuss issues relating to governance, compliance, executive compensation, and shareholder activism in the context of the one of the biggest social challenges of the past two decades—the opioid crisis.

Citation

Educators

Directors' Perceptions of Board Effectiveness and Internal Operations

By: J. Yo-Jud Cheng, Boris Groysberg, Paul M. Healy and Rajesh Vijayaraghavan

October 2021 |
Article |
Management Science

We contribute to the growing literature on the effectiveness of corporate boards by examining the effect of two insights that have been largely unexplored in prior studies that use public data. First, since boards’ responsibilities are wide-ranging, more holistic performance measures may better capture the full range of their duties than specific public actions and outcomes (e.g., disclosure of risk management processes, financial restatements, acquisition returns, CEO turnover). And second, because corporate boards share many characteristics of other types of teams, their effectiveness is likely to be influenced by their internal operations. To examine the performance effects of these insights, we use data from 577 directors of U.S. public firms that responded to a survey we conducted in 2015–2016 and qualitative data from interviews of 75 directors. Our study establishes a strong relation between director perceptions of board performance effectiveness and internal board operations. Further, by highlighting the critical role of internal operations, identifying areas of relative strength and weakness in boards’ effectiveness in various activities, and probing director perceptions of their primary responsibilities, we are able to offer concrete suggestions for future research on board effectiveness.

Keywords: Boards Of Directors; Corporate Governance; Governing and Advisory Boards; Performance Effectiveness; Perception

Citation

Find at Harvard

Haidilao: Changing your Future with your Own Hands

By: Dennis Campbell and Yuan Zou

September 2021 |
Case |
Faculty Research

Citation

Educators

Vignettes on Professional Service Firm Governance

By: David G. Fubini, Suraj Srinivasan and Li-Kuan Ni

September 2021 |
Teaching Note |
Faculty Research

Citation

Vignettes on Professional Service Firm Governance

By: David G. Fubini, Suraj Srinivasan and Li-Kuan Ni

September 2021 |
Case |
Faculty Research

The two vignettes within “Vignettes on Professional Service Firm Governance” (HBS No. 122-024) present various issues relating to governance in professional service firms (“PSFs”). In the first, the Managing Director of a U.S. consulting firm contemplates whether to bring on outsiders to sit on the firm’s Executive Leadership Board and the potential implications of doing so. In the second, a U.S.-headquartered Private Equity firm’s Managing Partner of India was excited about the opportunity to acquire another Indian firm but worries about the potential resistance from the firm’s Global Management Committee. This vignette has deliberately been written as a PE firm so as to allow participants from PSF firms to step away from their immediate organizations and reflect on the broader issues that are involved. This vignette attempts to explore the meaning of being a global firm in the context of PSF and the methods to realize a PSF’s global ambitions. The vignettes allow students to discuss a breadth of issues related to the governance and strategy of PSFs.

Citation

Educators

Harambe: Mobilizing Capital in Africa

By: Anywhere (Siko) Sikochi, Dilyana Karadzhova Botha and Francesco Tronci

September 2021 |
Case |
Faculty Research

Harambe was a non-profit organization whose mission was to build an ecosystem to identify promising young African entrepreneurs and provide them access to training, markets, capital, and support networks. From 2007 to 2021, Harambe had grown to a network of 367 entrepreneurs, known as “Harambeans”. They had collectively raised over $800 million in capital, created more than 3,500 jobs, and claimed three of the six African startup unicorns in 2021. There was mounting pressure for Harambe to evolve to take advantage of its momentum, the changing entrepreneurship landscape in Africa, and increasing investor interest. Given this, Okendo Lewis-Gayle, founder and chairman, pondered the next steps for Harambe to maximize its impact in Africa. He considered three options: scale the current non-profit model, pivot to a for-profit venture capital model, or develop a hybrid model with a non-profit and a for-profit investment arm. Another important question was, “How should Harambe define impact?”