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ABSTRACT:Drawing a framework from strategic stakeholder theory and using 1999 to 2010 panel data from the United Kingdom’s (UK) non-life insurance industry, we examine the effect of reinsurance on the decisions to donate to charities, and the amount given. We find that reinsurance substitutes for charitable giving as it optimizes the interests of multiple stakeholders. We further note that corporate giving is directly related to the size and age of insurers, proportion of female directorships and insider ownership, but generally inhibited by chief executive officer (CEO) bonus plans, dominant shareholders, and financial experts on the board. Interestingly, when reinsurance interacts with board-level variables we find that the donations decision is positively related to CEO bonus plans, and negatively linked with inside ownership and the proportion of female board members. Our research results could have important implications for stakeholders.

A reduced form hazard rate model of merger timing, estimated using a uniquely constructed 1990 -2004 UK panel data set, shows clear correlations between the observed wave like pattern of merger activity and both exogenous and endogenous drivers with firm characteristics acting as intermediaries.

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Using frequency domain techniques, a cycle of 6‐year duration at the aggregate level and coherent sectoral cycles of average 5‐year duration are found in UK merger activity between 1969 and 2005. It is shown that business and capital market cycles jointly are causal for the merger cycle but the capital market cycle alone is not, suggesting that merger cycles may reflect disequilibria and/or market mis‐valuation. Although the possibility of disequilibrium or strong behavioural influences will complicate social evaluation, no reason is found to advise against the current UK policy stance upon mergers.