If Trump, Modi Talk Climate
All this makes for an awkward prelude to Prime Minister Narendra Modi’s visit to Washington — a pity, since the two headstrong heads of state have a lot in common. Diplomacy may demand that the climate kerfuffle be kept off the agenda. In the unlikely event that it does come up, though, here is a cheat sheet for the PM.
Read the full piece from Dean Chakravorti in The Indian Express
As the calendar turns summer and another class leaves Fletcher, we reflect on some of the fascinating research we’ve supported from students in the past. In this post, we revisit MIB ’16 graduate Nathan Holdstein’s research on investor relations for companies in Mainland China.
For firms at various stages of development, listing shares on a major international stock exchange is the penultimate measurement for establishing oneself as a “successful” business. This is especially true of firms based in Mainland China. In many cases, firms choose to list shares outside of the country, mostly in Hong Kong and the United States, either as a primary listing or to supplement existing listings on local bourses. Those that do so can face intense scrutiny from market regulators, investors, media, and the general public. What can they do to better demonstrate the value they will bring to shareholders in international markets?
The author interviewing Prof. Zhigang Tao, Hong Kong University
My capstone looks at the investor relations component, and why Chinese companies should more actively engage key market players to better show their value. I am hypothesizing that companies doing so have larger percentages of institutional shareholders, which will reduce volatility and push the price up over the long-term. This occurs in large part because those firms that are successful will provide the market with a steady stream of reports, forward guidance, and general news updates to give analysts and stakeholders a better understanding of what the company’s value is.
With support from the Institute for Business in the Global Context, I traveled to the Special Administrative Region in Hong Kong to meet experts and practitioners of investor relations and finance there. Given its proximity to the Mainland and relatively market oriented monetary regulation & capital controls, it is no surprise that a number of Chinese companies choose to go public on the Hong Kong Stock Exchange. I wanted to get a better understanding of what it takes to have a successful listing in Hong Kong, in which the share price remains relatively stable and increases in value.
Menghan Li (F18) first realized she wanted to fight poverty while she was working with rural children. These children had been abandoned, not only because their parents needed to find employment, but also because they were female. “I started to think about how a special group of people — rural girls — suffer from dual disadvantages from the society — one from their background, the other from their gender,” Li recalls.
When she heard about The Fletcher School and The Institute for Business in the Global Context’s (IBGC) partnership with D-Prize, which awards up to $20,000 to fund new ventures that fight poverty in Africa, Asia or other developing regions, Li knew what her project would be: women’s education. Li won over the judges with her ComeOnGirls scholarship platform, and was recently announced as the 2017 Fletcher D-Prize winner.
Menghan Li (middle) receives the Fletcher D-Prize award from (left to right) Dean James Stavridis, Dorothy Orszulak, Bhaskar Chakravorti, and Marilyn Davison (and her dog, Chili!)
ComeOnGirls is a nonprofit that works to alleviate poverty by improving women’s education. The pilot program will launch in Western China —where Li says two-thirds of female students drop out of school — and she hopes to expand to other countries like Brazil and India. “We want to help remove the financial barrier and gender discrimination in secondary education by awarding scholarships,” she says. “The girls we select must demonstrate outstanding academic performance or special talents, and the drive to change their own lives as well as to contribute to the long-term development of the local community.”
by James Kochien (MIB 2017)
“Disneyland is presented as imaginary in order to make us believe that the rest is real.”
Quick, what’s the world’s largest media company? If you guessed The Walt Disney Company, you’re wrong – Disney is No. 2, after Google, which hardly seems like a fair comparison. After all, over the past decade Disney has absorbed the Marvel superhero franchises, rebooted Star Wars, and put a new generation of princesses on the toy shelves of the world. All of the global top-5 grossing films in 2016 were Disney properties, totaling over $5 billion in sales. Disney parks saw 140 million visitors in 2015, over two times its nearest competitor. And after a string of expansions that left shareholders unsatisfied, Disney parks opened a new Disneyland in Shanghai, China, to great fanfare. No. 1 or not, Disney dominates the spaces in which it plays.
It is also a company with historical and cultural significance that makes its success somewhat surprising in the globalizing economy. It is founded in an “American” version of family values and prosperity.[i] Its films and parks traffic in a sort of watered-down multiculturalism with America firmly at the center, the proverbial passengers on the ship winding through the plucky, costumed children of “It’s a Small World.” Successful films drive attendance at themed park attractions, and successful attractions nurture new film franchises. It’s a tight synergy that allows Disney to charge a premium for its parks and merchandise.
Can China’s Companies Conquer the World?
Despite China’s recent economic struggles, many economists and analysts argue that the country remains on course to overtake the United States and become the world’s leading economic power someday soon. Indeed, this has become a mainstream view—if not quite a consensus belief—on both sides of the Pacific. But proponents of this position often neglect to take into account an important truth: economic power is closely related to business power, an area in which China still lags far behind the United States.
Read the full piece from Prof. Thomas Hout and Pankaj Ghemawat in the March/April issue of Foreign Affairs
As part of an ongoing series, we will be featuring the recent work of a number of our esteemed business faculty here at The Fletcher School. The series continues with Joel Trachtman, Professor of International Law at The Fletcher School.
Joel Trachtman gave a speech on a panel of the ICTSD (International Center for Trade and Sustainable Development) in late January 2016. The speech asked the question,
“How does WTO law restrict national labeling regimes for environmental protection, specifically US dolphin safe tuna labeling standards.” You can watch the full panel discussion online as well as view Prof. Trachtman’s slides.
Professor Trachtman also wrote a pair of working papers in 2015-16, one for the RFF (Resources of the Future) and the other for the European University Institute:
- “WTO Law Constraints on on Border Tax Adjustment and Tax Credit Mechanisms to Reduce the Competitive Effects of Carbon Taxes.” – If the US imposes carbon taxes, how will WTO law shape the way that the US applies these carbon taxes to imported and exported goods? Read the paper online
- “Export Restrictions and the Limits of Textual Interpretation. ” – How did the US use WTO law to persuade China to liberalize exports of rare earth minerals? Read the paper online
In addition, Prof. Trachtman penned a chapter for “The Obsolescence of Customary International Law,” which features in Curtis Bradley’s (ed.), Custom’s Future (Cambridge University Press, 2016). The chapter asks, does traditional customary international law work to address major international business, economic, and security problems?
Art of a climate deal
The Paris conference on climate change was quite the cliffhanger. Even till the last minute, we were left wondering: Will Paris be another Copenhagen, where, famously, the deal had unravelled? Officials worked late into the wee hours, well past the official deadline, to cobble together a document on which 196 nations could put their signatures. Leaders who had staked their reputations on getting a deal done, from US President Barack Obama to French President Francois Hollande, hailed a planetary social contract of historic proportions. Even India, a petulant participant at the start, declared that “climate justice” had been done.
Read the full op-ed from Dean Chakravorti in The Indian Express
“Market upheaval forcing many sovereign-wealth funds to adapt”
by Sue Chang
“For funds that are resource-based—particularly oil—dramatic drops in price will affect the rate and scale of their future accumulation of new assets, while potentially requiring assets sales or outflows to fund possible fiscal deficits,” said Patrick Schena, co-head of SovereigNET at the Fletcher School at Tufts University.
Read the full article, featuring quotes and insight from Prof. Schena, in MarketWatch