Professor Ron Bird

Ross, S., Trayler, R.M., Bird, R.G., Westerfield, R.W. & Jordan, B.D. 2007, Essentials of corporate finance, 1st, McGraw-Hill, Sydney, Australia.

Bird, R.G. & Gray, J. 2009, 'Improving pension management and delivery: An (im)modest and likely (un)popular proposal', Rotman International Journal of Pension Management, vol. 2, no. 2, pp. 36-40.
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The single-minded aim of retirement savings policy is to maximize after-cost returns to members while providing products and services to meet individual needs. In that it fails. The dominant cause of failure is ineffective and unnecessary competition. The dominant solution is greater cooperation. This article demonstrates how excessive competition has undermined investors? ability to save for retirement through inefficient pricing, agency costs, and excessive choice. To ensure more cooperation, and less competition, the authors propose a three-pronged approach: structuring management arrangements to extract maximum economic growth and investment returns; taking steps to rid the system of over-servicing; and, structuring relationships to minimize agency costs. While the authors use Australia as their institutional setting, their (im)modest, and likely (un)popular proposal has universal (un)appeal and applicability.

Mar, J.L., Bird, R.G., Casavecchia, L. & Yeung, D.C. 2009, 'Fundamental indexation: An Australian investigation', Australian Journal of Management, vol. 34, no. 1, pp. 1-20.
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Capitalisation-weighted indexes provide the basis for passive investment strategies designed to capture market performance. However, these cap-weighted indexes are claimed to be sub-optimal because of their tendency to overweight overvalued shares and underweight undervalued shares. U.S. evidence suggests that fundamental indexes, which select, rank and weight stocks according to fundamental measures of size such as book value and revenue, outperform cap-weighted indexes. This study examines fundamental indexation in an Australian context over the period 1995 to 2006 and finds support for the U.S. results. However, we also find that the superiority of fundamental indexation is largely explained by its inherent bias towards value stocks, which raises the question as to whether a more overt value tilt may not provide a superior means for exploiting mispricings in markets.

Bird, R.G. & Casavecchia, L. 2007, 'Sentiment and Financial Health Indicators for Value and Growth Stocks: The European Experience', The European Journal of Finance, vol. 13, no. 8, pp. 769-793.
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The well-documented market underperformance of the majority of value and growth stocks over a 12-month holding period reflects that traditional valuation metrics might tell us whether a stock is potentially cheap or expensive but little about when, or even if, it will experience a market correction. Two indicators have come to the fore in recent years that provide useful insights: sentiment/momentum and accounting fundamentals/financial health.We examine their single and combined impact on value and growth stocks and find that (i) they are effective in introducing a timing element into the selection of both value and growth stocks, (ii) the sentiment indicator completely dominates the financial health indicator and, (iii) both indictors contribute to the performance of the good and bad growth stocks. The size and significance of the investment profits that potentially can be generated using the two indicators in combination questions of the efficiency of the European equity markets.We conclude that our findings are consistent with the pricing cycle for a stock proposed by Lee and Swaminathan (Lee, C. and Swaminathan, B. (2000) Price momentum and trading volume, Journal of Finance, 55, pp. 2017?2069.) and the under- and over-reaction in pricing inherent in models proposed by Barberis et al. (Barberis, N., Shleifer A., and Vishny, R. (1998) A model of investor sentiment, Journal of Financial Economics, 49, pp. 307?343.) and Hong and Stein (Hong, H. and Stein, J.C. (1999) A unified theory of underreaction, momentum trading and overreaction in asset markets, Journal of Finance, 54, pp. 2143-2184.).

Bird, R.G. & Casavecchia, L. 2007, 'Value Enhancement Using Momentum Indicators: The European Experience', International Journal of Managerial Finance, vol. 3, no. 3, pp. 229-262.
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Abstract: Purpose ? The purpose of this research is to study the extent to which various price and earnings momentum measures can be used to enhance portfolio performance by better timing entry into value stocks (and isolating those growth stocks that still have some period to run). Design/methodology/approach ? The paper uses the traditional methodology of ranking stocks on the basis of certain value and momentum measures (e.g. book-to-market, market return over some prior period), forming portfolios based on these rankings which are held for a specific period of time. The portfolios are formed on the basis of a single measure of multiple measures and the returns and associated p-values are calculated with the objective of determining how these portfolios perform relative to a benchmark portfolio composed of all the companies in the universe. The analysis is conducted on a database consisting of approximately 8,000 companies drawn from 15 European countries over the period from January 1989 to May 2004.

Bird, R.G., Hall, A.D., Momente, F. & Reggiani, F. 2007, 'What Corporate Social Responsibility Activities are Valued by the Market?', Journal of Business Ethics, vol. 76, no. 2, pp. 189-206.
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Corporate management is torn between either focusing solely on the interests of stockholders (the neo-classical view) or taking into account the interests of a wide spectrum of stakeholders (the stakeholder theory view). Of course, there need be no conflict where taking the wider view is also consistent with maximising stockholder wealth. In this paper, we examine the extent to which a conflict actually exists by examining the relationship between a company's positive (strengths) and negative (concerns) corporate social responsibility (CSR) activities and equity performance. In general, we find little evidence to suggest that managers taking a wider stakeholder perspective will jeopardise the interest of its stockholders. However, our findings do suggest that the market is not only influenced by the independent CSR activities, but also the totality of these activities and that the facets that they value do vary over time. It seems that most recently, the market has valued most firms that satisfied minimum requirements in the areas of diversity and environmental protection but were most proactive in the area of employee-relations.

Bird, R.G. & Gerlach, R. 2006, 'A Bayesian model averaging approach to enhance value investment', International Journal of Business and Economics, vol. 5, no. 2, pp. 111-127.
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Simple financial ratios such as book-to-market are often used to identify value stocks. This paper examines the extent to which fundamental accounting information can be used to better identify truly undervalued value stocks to enhance profit in a simple value strategy. Gibbs sampling and model averaging are used in a logistic regression setting, employing fundamental accounting information as explanatory variables, in the design of an implementable investment strategy applied to markets in the US, the UK and Australia.

Azzi, S. & Bird, R.G. 2005, 'Prophets during boom and gloom downunder', Global Finance Journal, vol. 15, no. 3, pp. 337-367.

Bird, R.G., He, X.T., Thosar, S.B. & Woolley, P.K. 2005, 'The case for market inefficiency: investment style and market pricing', The Journal of Asset Management, vol. 5, no. 6, pp. 365-388.
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Bird, R.G. & Whitaker, J. 2004, 'The performance of value and momentum investment portfolios: recent experience in the major European markets.Part 2.', Journal of Asset Management, vol. 5, no. 3, pp. 157-175.
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In a previous paper ('The Performance of Value and Momentum Investment: Portfolios: Recent Experience in the Major European Markets', Journal of Asset Management, 4(4), 221?46, 2003), the authors found that simple value and momentum investment strategies achieved good performance when applied to the major European markets since 1990. This paper extends this analysis to more complex strategies involving a combination of value and momentum investing, which were found to be particularly complementary and so give rise to exceptional investment outcomes. It is suggested that the findings support the existence of a value/momentum cycle along the lines of that proposed by Swaminathan and Lee ('Do Stock Prices Overreact to Earnings News?' Cornell Graduate School of Management Working Paper, 2000) and that this has very real implications for how managers might enhance either value or growth investment strategies.

Bird, R.G. & Whitaker, J. 2003, 'The performance of value and momentum investment portfolios: recent experience in the major European markets', Journal of Asset Management, vol. 4, no. 4, pp. 221-246.
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Woolley, P.K. & Bird, R.G. 2003, 'Economic implications of passive investing', The Journal of Asset Management, vol. 3, no. 4, pp. 303-312.
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Bird, R.G. & Gallagher, D.R. 2002, 'The evaluation of active manager returns in a non-symmetrical environment', Journal of Asset Management, vol. 2, no. 4, pp. 303-324.
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Gerlach, R., Bird, R.G. & Hall, A.D. 2002, 'Bayesian variable selection in logistic regression: predicting company earnings direction', Australian & New Zealand Journal of Statistics, vol. 42, no. 2, pp. 155-168.

Bird, R.G. & McKinnon, J.G. 2001, 'Changes in the Behavior of Earnings Surprise: International Evidence & Implications', Journal of Investing, vol. 10, no. 3, pp. 19-32.

Bird, R.G., Gerlach, R. & Hall, A.D. 2001, 'The Prediction of Earnings Movements Using Accounting Data: An Update & Extension of Ou and Penman', Journal of Asset Management, vol. 2, no. 2, pp. 180-195.
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Bird, R.G., Mceiwee, B. & McKinnon, J.G. 2000, 'A global perspective of analyst's earning forecasts', Journal of Investing, vol. 9, no. 4, pp. 76-82.

Azzi, S., Bird, R.G., Ghiringhelli, P. & Rossi, E. 2006, 'Biases and information in analysts'recommendations: The European experience', The Journal of Asset Management, vol. 6, no. 5, pp. 345-380.

Bird, R.G. & Casavecchia, L. 2006, 'Insights into the momentum life cycle for European stock', Journal of Investing, vol. 15, no. 3, pp. 105-118.

Bird, R.G., He, X.T., Thosar, S.B. & Woolley, P.K. 2005, 'Momentum and index investing: implications for market efficiency', Journal of Financial Transformation, vol. 15, no. December, pp. 79-85.

Azzi, S., Bird, R.G., Griringhelli, P. & Rossi, E. 2005, 'Biases and information in analysts' recommendations: The European experience', European Financial Management Association 2005 Annual Meetings, Milan, Italy, June 2005 in Proceedings of the European Financial Management Association 2005 Annual Meetings, ed -, EFMA, Milan, Italy, pp. 1-42.
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Financial analysts are viewed as playing an important intermediary role in gathering and interpreting data and thus converting it into useful information for the investment community. However, in recent years, it has become more apparent that the analysts come under much internal and external pressure when making their forecasts and recommendations. Jegadeesh et al (2004) have highlighted that this results in US equity analysts being biased towards large, high momentum growth stocks when making their recommendations which presumedly causes them to add little or no value in their own right. However, they find that the analysts? recommendations changes do provide useful incremental investment insights. Azzi and Bird (2005) when evaluating Australian analysts similarly found that it was only the recommendation changes that provided useful information to investors. However, they also found evidence to suggest that the analysts attempt to adjust the biases in their recommendations over the market cycle. The implication being that biases identified in the Jegadeesh et al study may have been as much a reflection of the analysts pursuing the types of stocks that were performing well during the period rather than any long-term bias in these recommendations.

Bird, R.G., Casavecchia, L. & Reggiani, F. 2007, 'Corporate Social Responsibility and Corporate Performance: Where to Begin?', European Financial Management Association 2007 Annual Meetings, Vienna, Australia, June 2007.

Bird, R.G., Casavecchia, L. & Reggiani, F. 2007, 'Corporate Social Responsibility and Corporate Performance: Where to Begin?', European Academy of Management Conference, Paris, France, May 2007.

Bird, R.G. & Casavecchia, L. 2007, 'Insights into the Market Impact of Different Investment Styles', Trading Strategies and Financial Market Inefficiency, London, UK, March 2007.

Bird, R.G. 2007, 'The market impact of momentum investors: A simulation study', Trading Strategies and Financial Market Inefficiency, London, UK, March 2007.

Bird, R.G. & Casavecchia, L. 2007, 'The probability of style rotation for value and growth stocks along their earnings and momentum life cycle', 2007 Financial Management Association Annual Meeting, Orlando, Florida, October 2007 in 2007 Financial Management Association Annual Meeting, ed -, Financial Management Association, Orlando, Florida, pp. 1-27.

Bird, R.G. & Casavecchia, L. 2007, 'The profitability of style rotation for value and growth stocks along their earnings and momentum life cycle', European Financial Management Association 2007 Annual Conference, Vienna, Australia, June 2007.

Bird, R.G. & Casavecchia, L. 2006, 'An analysis of causality in the relationship between analysts' forecast revisions and market prices', 17th Annual Asian Finance Association/FMA Conference, Auckland, New Zealand, July 2006 in 17th Annual Asian Finance Association/FMA Conference, ed -, Asian Finance Association, Auckland, pp. 1-21.

Bird, R.G. & Casavecchia, L. 2006, 'Sentiment and financial strength indicators for value and growth stocks: The European experience', 13th Annual Conference of the Multinational Finance Society, Edinburgh, UK, June 2006 in 13th Annual Conference of the Multinational Finance Society, ed -, -, -.

Bird, R.G. & Casavecchia, L. 2006, 'Sentiment and financial strength indicators for value and growth stocks: The European experience', The European Financial Management Association 2006 Annual Meetings, Madrid, Spain, June 2006 in The European Financial Management Association 2006 Annual Meetings, ed -, -, -.

Bird, R.G. & Casavecchia, L. 2006, 'The relationship between corporate social responsibility and corporate performance: The magnitude and the direction', Seminar Presentation, School of Finance and Economics, University of Technology, Sydney, Sydney, Australia, May 2006.
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Corporate management is torn between either focusing solely on the interests of stockholders (the neo-classical view), or taking into account the interests of a wide spectrum of stakeholders (the stakeholder theory view). Of course, there need be no conflict where taking the wider view is also consistent with maximising stockholder wealth. We examine the extent to which a conflict actually exists by investigating the relationship between a companya??s positive (strengths) and negative (concerns) corporate social responsibility (CSR) activities and corporate financial and market performance. In general, we find no evidence to suggest that managers taking a wider stakeholder perspective will jeopardise the interest of stockholders. Our findings do suggest that the market is influenced by the broad index constructed on strengths and concerns of CSR activities. The analysis also concentrates on examining the nature of causation in the relationship between CSR and corporate performance and finds that, in general, a relevant leading phenomenon exists, with well performing firms developing more (a??slacka??) resources to allocate to CSR activities, with CSR which consequently feedbacks on corporate performance.

Bird, R.G. 2006, 'Tredici anni di rating di sostenibility negli USA: Effects on market returns', Il Contributo Della Sostenibility al Valore d'Impresa, Milan, Italy, April 2006 in Il Contributo Della Sostenibility al Valore d'Impresa, ed -, -, -.

Azzi, S., Bird, R.G., Griringhelli, P. & Rossi, E. 2005, 'Biases and information in analysts' recommendations: the European exprerience', 2005 FMA Annual Meeting, Chicago, USA, October 2005 in Proceedings of the 2005 FMA Annual Meeting, ed -, FMA, Chicago, USA, pp. 1-42.

Azzi, S. & Bird, R.G. 2004, 'Prophets during boom and gloom downunder.', 2004 Financial Management Association Meeting, New Orleans, US, October 2004 in 2004 Financial Management Association Meeting, ed -, Financial Management Association, USA, pp. ---.

Bird, R.G., He, X.T., Thosar, S.B. & Woolley, P.K. 2004, 'The case for market inefficiency: investment style and market pricing.', 2004 Financial Management Association Meeting, New Orleans, USA, October 2004 in 2004 Financial Management Association Meeting, ed -, Financial Management Association, USA, pp. 1-24.

Bird, R.G. 2004, 'The case for market inefficiency: Investment style and price behavior prophets during boom and gloom Down Under', Global Finance, Las Vegas, USA, April 2004 in Global Finance Conference, ed -, -, -.

Bird, R.G. & Gerlach, R. 2003, 'The good and the bad of value investing: applying a Bayesian approach to develop enhancement models', 2003 Annual Meeting - European Financial Management Association, Helsinki, Finland, June 2003 in 2003 Annual Meeting - European Financial Management Association, ed --, European Financial Management Association, Helsinki.

Bird, R.G. & Whitaker, J. 2003, 'The performance of value and/or momentum investment strategies: recent experience in the major European markets', Lyon, France, June 2004 in 20th AFFI International Conference 2003, ed --, The Association Francaise de Finance, Lyon.

Bird, R.G., Gerlach, R. 2002, 'A bayesian approach to enhancing a value strategy', INQUIRE UK Annual Conference, UK, September 2002 in INQUIRE UK Annual Conference.