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Randall A. Heron
One America Foundation Endowed Chair
Specializing in corporate finance, Randall Heron investigates a variety of issues, including corporate governance, mergers and acquisitions, corporate restructurings, and takeover defenses. Heron, a member of the Kelley Indianapolis faculty since 1997, received his bachelor's and M.B.A. degrees from Western Illinois University in 1990 and 1991, respectively, and his Ph.D. from Purdue University in 1995. He became an Associate Professor of Finance in 2003 and has received a number of awards for both his teaching and research.
Heron has researched and written about executive compensation issues. His 2006 paper, "Does backdating explain the stock price pattern around executive stock option grants?," coauthored with Erik Lie, Ph.D., of the University of Iowa, was instrumental in uncovering the backdating of stock option grants in corporate America. As a result, both Heron and Lie have become noted experts on this topic.
"Producing high-quality academic research of interest is very time consuming, but also very rewarding," explains Heron. "It's a constant battle to stay ahead of the game – uncovering issues and answering questions that add value to current business discussions. Our experience with the stock option grant research is an example of how academic research can uncover irregularities and ultimately, lead to improvements in business practices going forward." Heron also notes an additional positive side-effect of an active research agenda, "Research leads to knowledge creation, which in addition to enhancing your understanding of complex issues, makes you more effective in the classroom."
With an interest in corporate takeovers, Heron has also investigated the use of takeover defenses, specifically studying the effects on shareholder gains when or "poison pills," are employed. This research is often used by corporations to justify the use of takeover defenses to enhance management's bargaining power on behalf of shareholders in corporate control contests.
Heron's research has been discussed in numerous business publications, both nationally, and internationally.