Cookies?
Library Header Image
LSE Research Online LSE Library Services

Managerial response to shareholder empowerment: evidence from majority- voting legislation changes

Cuñat, Vicente ORCID: 0000-0001-7504-2801, Lu, Yiqing and Wu, Hong (2021) Managerial response to shareholder empowerment: evidence from majority- voting legislation changes. Financial Markets Group Discussion Papers (826). Financial Markets Group, The London School of Economics and Political Science, London, UK.

[img] Text (DP826) - Published Version
Download (7MB)

Abstract

This paper studies how managers react to shareholder empowerment that makes the votes on shareholder proposals regarding majority-voting director elections binding. Exploiting staggered legislative changes that introduce such empowerment, we find that managers become more responsive by initiating majority voting through either management proposals or governance guidelines. Further results suggest compromised implementation: managers adopt provisions that give them greater control over the channel of implementation and allow them to retain directors who fail in elections. Managers show the greatest resistance to implementing majority-voting standards when shareholder value is likely to suffer more or benefit less from the legislation.

Item Type: Monograph (Discussion Paper)
Official URL: https://www.fmg.ac.uk/
Additional Information: © 2021 The Authors
Divisions: Finance
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HG Finance
JEL classification: G - Financial Economics > G3 - Corporate Finance and Governance > G34 - Mergers; Acquisitions; Restructuring; Corporate Governance
G - Financial Economics > G1 - General Financial Markets > G14 - Information and Market Efficiency; Event Studies
Date Deposited: 23 May 2023 13:45
Last Modified: 16 Sep 2023 00:00
URI: http://eprints.lse.ac.uk/id/eprint/118896

Actions (login required)

View Item View Item

Downloads

Downloads per month over past year

View more statistics