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Blockholder monitoring is central to corporate governance, but blockholders large enough to exercise significant unilateral influence are rare. Mechanisms that enable small block-holders to exert collective influence are therefore important. We present a model in which one or more sizeable lead activists implicitly coordinate with many smaller followers in engaging target management.
Our model formalizes a key source of complementarity across the engagement strategies of institutional blockholders, arising from their motivation to attract investment flows, which overcomes free riding even for small blockholders and enables coordinated engagement. We also endogenize ownership changes in anticipation of activism campaigns.
This paper develops a theory of blockholder governance and the voting premium. A blockholder and dispersed shareholders first trade in a competitive...
In this contribution, we focus on the market for stewardship, as this has been developing in the UK. We observe that the 2020 UK Stewardship Code more...
We explore a novel survey on responsible investing by institutional investors around the world and match it to archival data on their equity portfolio...