Harvard Law School Forum on Corporate Governance / Stanford Closer Look Series: VICI Properties—Creating Value from the Ashes of Caesar’s Demise

By William J. Ferguson, David F. Larcker, and Brian Tayan

From the Stanford Closer Look Series article VICI Properties: Creating Value from the Ashes of Caesar’s Demise

From the Harvard Law School Forum on Corporate Governance

From VICI Properties: VICI Properties Focus of Corporate Governance Case Study

Case studies of corporate governance often focus on failures—bankruptcies, fraud, terminations, and lawsuits. From these, consultants and researchers offer a post-mortem perspective on how failure could have been avoided if only certain best practices were adhered to. Recommendations are then cobbled together to help other corporations avoid a similar outcome.

Much rarer (and much harder to find in financial press accounts) are clear-cut examples of corporations where a careful selection of governance features played an important role in positioning the company for subsequent financial and operating success. Such stories are not salacious enough to drive media viewership, even though they are instructive to practitioners who aim to improve the performance of their organizations.

VICI Properties—a publicly traded REIT that emerged out of the post-bankruptcy ashes of Caesar’s Entertainment—offers an interesting example in which the eventual controllers of the assets were able to design critical corporate governance features de novo with the purposeful intention of creating a system that would add significant value to their ownership securities. Through this Closer Look, we can learn important lessons about how appropriate governance choices can change the course of a corporation and establish a foundation for long-term success. In particular, we will focus on the role governance can play in creating stakeholder trust in situations in which trust had earlier been broken.

Continue reading the Stanford or Harvard PDF versions of the article.

Contact William J. Ferguson.