The Distribution of Voting Rights to Shareholders

This is the first comprehensive study of the distribution of voting rights to shareholders. Only those owning stock on the record date may vote. Firms, however, reveal that date after the fact 91% of the time. With controversial votes, firms are more likely to do the opposite, and this is associated with a lower passage rate for shareholder-initiated proposals. The NYSE sells non-public record-date information to select investors. When stocks go ex vote, prices decline and trading volume surges, suggesting that investors are buying marginal votes. These trends are most pronounced with controversial votes.