In our recent work, published in Harvard Business Review and based on our Journal of Banking & Finance paper, we study conflicts of interest in the banking industry. We show that brokerages with a higher share of women see their analysts (men and women alike) issue less inflated target prices when pressure is highest, i.e., when their bank is also underwriting the company they cover. In our data, moving one standard deviation up in female representation (about 7.7 percentage points) trims the average optimism bias by roughly 4%–12%. We also show it’s the organization’s gender composition, and not the individual analyst’s gender, driving the effect, and the pattern is confirmed when analysts switch employers or when mergers boost female representation. These results suggest a potential fix to environments prone to conflicts of interest: diversifying the team floor and you might be able to make everyone behave more ethically. 

Studying corporate bonds around firms’ first ASC 842 earnings announcements, our paper shows that when newly recognized lease liabilities came in higher than investors had inferred from footnotes, bond yields stepped up within days. The reaction was asymmetrical: markets punished underestimated lease debt but didn’t reward overestimates. The histogram in the figure below shows that over half of firms had understated off‑balance‑sheet leases before ASC 842. Rating agencies reacted too: a one‑percentage‑point increase in the lease‑liability gap raised the chance of a downgrade by ~11% during the announcement month. 

For CFOs and treasurers, the takeaway is that if ASC 842 revealed liabilities that were bigger than apparent before the regulation, expect higher financing costs, especially if you rely heavily on leasing, run complex multi‑segment operations, or have a weaker information environment (low institutional ownership, high analyst‑forecast dispersion). The only way forward is transparency. ASC 842 didn’t break market efficiency, but it reduced guesswork, and that made risk to get repriced.

Inside large U.S. firms, similarity quietly moves information. Analyzing insider trades from 1995–2016, we find that sharing a salient identity (especially gender) between insiders and the CEO/CFO opens informal channels that show up in trading results. When a woman holds the top executive or finance seat, female insiders’ trades become more profitable while men’s edge shrinks. The effect intensifies where formal interactions create proximity, such as serving on the same committees and sitting in meetings with multiple women present, and it is most visible in sales that anticipate bad news. Other commonalities, such as age, ethnicity or alma mater, help too, but less so than gender. We believe our result is important for companies: diversity doesn’t just change who’s in the room; it rewires the firm’s information sharing processes.