Abstract

http://ssrn.com/abstract=667625
 
 

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Would Mutual Funds Bite the Hand that Feeds Them? Business Ties and Proxy Voting


Gerald F. Davis


The Stephen M. Ross School of Business at the University of Michigan

E. Han Kim


The Stephen M. Ross School of Business at the University of Michigan

February 15, 2005


Abstract:     
This paper analyzes conflicts of interest in proxy voting by mutual funds using newly-available data on funds' voting records for 2004. We first examine mutual funds' ties to corporate clients created via pension fund business and their patterns of portfolio ownership. We then link these to proxy votes at specific firms and to overall voting policies for 21 mutual fund families, CalPERS and CREF. Among large fund families, levels of ownership are essentially independent of client relationships between mutual funds and firms, and funds are no more likely to vote with management at client firms than non-clients. At the policy level, however, we find a positive relation between the volume of pension business a fund's parent does and its propensity to vote with management.

Number of Pages in PDF File: 45

Keywords: Conflicts of interest, proxy voting, mutual funds, employee pension plans

JEL Classification: G23, G34, L14

working papers series


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Date posted: February 15, 2005  

Suggested Citation

Davis, Gerald F. and Kim, E. Han, Would Mutual Funds Bite the Hand that Feeds Them? Business Ties and Proxy Voting (February 15, 2005). Available at SSRN: http://ssrn.com/abstract=667625 or http://dx.doi.org/10.2139/ssrn.667625

Contact Information

Gerald F. Davis (Contact Author)
The Stephen M. Ross School of Business at the University of Michigan ( email )
701 Tappan Street
Ann Arbor, MI 48109-1234
United States
734-647-4737 (Phone)
734-936-0282 (Fax)
E. Han Kim
The Stephen M. Ross School of Business at the University of Michigan ( email )
701 Tappan Street
Ann Arbor, MI MI 48109
United States
734-764-2282 (Phone)
734-763-3117 (Fax)
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