Does Wall Street Value Corporate Governance?

Sarbanes-Oxley 2002 (SOX), coupled with changes in NYSE registration requirements, imposed stricter requirements for more independent governance on publicly traded American companies. Hedge Funds traded on improvements in corporate governance. Yet academics and journalists debated the economic impact of governance. Some of the questions this panel addressed: What is "good governance"? What are the two or three indicators of good or bad governance? Are there “red flags” for poor governance? Do companies that have independent governance structures have higher stock prices or lower cost of debt? Do portfolio managers prefer companies with more independent governance structures? Is there a lower "headline risk" for better-governed firms? Can badly governed firms do well in the short run? Long run? What are the benefits and costs of separating management from governance? Are boards still too dependent on management? Do investors expect too much from boards? Can there be too much governance? Does "good governance" vary in different parts of the world? Is it valued differently in other parts of the world?