I identify the causal effect of political connections on the private equity investments of U.S. public pension funds. Exploiting close gubernatorial elections as an identification strategy, I document that politically connected fund managers distort asset allocation decisions, reducing returns for pension beneficiaries. The findings illuminate agency problems in the governance of public retirement systems and the broader role of political economy frictions in institutional investor behavior.

Affiliated financial intermediaries serving the same customers may share a reputation. Using investment advisers' regulatory disclosures of shared locations with affiliated banks, I find that revealed adviser misconduct reduces co-located branches' deposits by approximately four to five percent. The response concentrates in misconduct bearing on customer treatment, scales with severity, and is strongest among retail-facing advisers and common-brand affiliations, consistent with depositors updating their view of the organization. Outflows reallocate to unaffected local competitors, and exposed branches are more likely to close. Corroborated by the 2003 mutual fund scandal, the results show reputational exposure extends across separately regulated sectors.

This paper examines how business ties with portfolio firms affect the asset management strategies of mutual funds. By exploiting the revelation of mutual fund advisory misconduct as an exogenous shock to these business ties, I find that mutual fund management firms with collapsed trust tend to increase their portfolio weights in client stocks following the misconduct revelation. This shift towards client stocks effectively reduces the likelihood of business partnership termination. Additionally, I find that client stocks underperform compared to non-client stocks and exhibit indifference towards net-selling stocks held by the same mutual fund families. These findings raise concerns about fiduciary duty violations and underscore the need for vigilance in aligning investment decisions with shareholder interests.