Tony Naughton

Tony Naughton (16 February 1952 – 16 July 2013) was a British/Australian financial economist and academic accountant who was the head of the School of Economics, Finance and Marketing at the Royal Melbourne Institute of Technology (RMIT) for over ten years immediately prior to his death in July 2013.

He was known for his research into finance and corporate governance and for his contribution to raising the research profile of the School of Economics, Finance and Marketing at RMIT.

He was also known for the successful mentoring of a large number of students and colleagues.

At the core of his research was the behaviour of security prices, which was subsequently extended to cover corporate governance explanations of firm performance, the stock returns of initial public offerings and trading strategies.

Much of the empirical work he did pertained to the emerging markets of Asia, particularly China.

In the years before his death he was involved in two major projects, the first of which was to examine the impact of stock market reforms in China, and the second was developing and testing a new instrument to examine behavioural biases in investor decision-making.

Naughton was born in Birmingham (England) on 16 February 1952, then he moved to Ireland at the age of five.

He sought independence by leaving home at the age of 16 to undertake a number of jobs, working as a kitchen assistant, a chef, a DJ and a bar tender.

He then went through a hippy phase, rocking long hair, a full beard, leather jacket and flared pants.

Before his death he expressed his wish to go to the Glastonbury festival in England at some point in his life.

He said that seeing Jimi Hendrix's final show was one of his most treasured memories.

Although he left home with nothing and dropped out of school at 16, he paid for his education by working multiple jobs and managed to become a certified accountant.

Following his work as an accountant, he did an MBA at Bradford University and went on to become a lecturer at Leeds Polytechnic.

In 1975 he obtained membership of the Association of Chartered Certified Accountants and he was elected as a fellow in 1980.

During the period 1976-1982 he had his own auditing and accounting practice, Naughton & Co. Prior to that he had obtained auditing and accounting experience with Touche Ross and Morley & Scott Chartered accountants in Birmingham and London, specializing in the audit of banks and financial institutions.

Naughton made contributions to several areas of finance.

Starting with asset pricing, he wrote an article on the Taiwan stock market in which he developed a multifactor asset pricing model incorporating a price limit factor to explain the cross section of asset returns following closely the mimicking portfolio Fama-French methodology.

The findings showed that the overall market factor, firm size and price limits capture a cross section of average stock returns in a meaningful manner.

In an article on China he compared the performance of the traditional CAPM with the multifactor model of Fama and French for equities listed in the Shanghai Stock Exchange.

He also investigated the explanatory power of idiosyncratic volatility and responded to the claim that multifactor model findings can be explained by the turn of the year effect.

He conducted further work on Indonesia, Singapore and Taiwan to examine the proposition that the beta in the capital asset pricing model (CAPM) was lacking in cross-sectional explanatory power.

By incorporating the two most commonly used additional explanatory factors (size and book to market equity) he tested for evidence of multifactor risk premia.

The results showed that the overall market factor was highly significant in all of the markets and that the magnitude of significance of the other two factors (size and book to market equity) varied across countries.

He rejected the claim that the multifactor model findings could be explained by the turn of the year effect.

Naughton was an expert on trading strategies.

Subsequently, he earned a Master of Business Administration (with a major in Financial Management) from the Management Centre, University of Bradford in 1980.

At the age of 30, Naughton went to work at the University of South Pacific in Fiji, where he met his wife, Shahnaz and they got married in 1986.

They went back to Birmingham together before moving to Wollongong, Australia.

It was in Wollongong where the couple had their two daughters, Sophie and Jennifer.

Naughton started his academic and professional life as an accountant.

During the period July 1987 to December 1994, he was a senior lecturer in finance at the Department of Management, University of Wollongong.

He also held the positions of a lecturer in development finance at the University of Birmingham, a lecturer at the School of Social and Economic Development at the University of the South Pacific (Fiji) and a senior lecturer at the School of Accounting and Applied Economics, Leeds Polytechnic.

Naughton held a number of adjunct/visiting positions.

At the PhD level he concentrated on banking and finance as he obtained his doctorate from the Department of Accounting and Finance, University of Birmingham, in 1995.

Prior to taking his last position as the head of the School of Economics, Finance and Marketing at RMIT, he held several academic positions in a number of institutions.

He was a senior lecturer and the head of the School of Banking and Finance, University of New South Wales, from January 1995 to January 1997.

From 1997 to 2003 he was a professor of international finance and the head of the School of Accounting and Finance, Griffith University.

He was an adjunct professor at Universitas 21, Singapore, from 2004 until his death in 2013.

He was also a visiting professor at the China Europe International Business School (CEIBS), Shanghai, a visiting professor at the Centre for Corporate Governance Research, University of Birmingham, an adjunct professor at the Centre for International Business Research, University of Wollongong, an adjunct senior lecturer at the Graduate School of Business, University of Sydney, a visiting fellow at the School of Banking and Finance, University of New South Wales, a visiting research fellow at Universitas Islam, Indonesia, and a visiting senior research fellow at the Department of Accounting and Finance, University of Birmingham.

Naughton's professional experience was exclusively in accounting.