Wouldn't ya' know it - just as we updated our bibliography of academic papers, two new ones appear that add nicely to the literature on academic investing.

One analyzes the impact of BoD tenure on firm performance. The title says what you need to know - in "Zombie Boards: Board Tenure and Firm Performance", Sterling Huang of INSEAD concludes that for the first few years, increasing BoD tenure improves performance, as directors learn more about the company. After about nine years, though, performance declines as the BoD becomes more entrenched.

The other breaks new ground in assessing how activist investing affects firms and firm performance. In "The Disciplinary Effects of Proxy Contests", Vyacheslav Fos of the University of Illinois analyzes the how this particular form of activism, a proxy contest, influences both what firms do and how they perform. In a carefully and exhaustively researched paper, he concludes firms change to respond to actual and potential proxy situations, and these changes generate positive returns for investors.

The Fos paper has another interesting idea: he has designed a method for estimating the likelihood of a proxy contest taking place at a given company. Since we've seen (and Fos shows, again) the positive impact that proxy contests have on companies, this could be quite valuable for creating an activist investing portfolio. Some clever portfolio manager should use this method in their work.

We summarize all of these papers in a previous blog post.