The Influence of Institutions on Corporate Governance Through Private Negotiations: Evidence from Tiaa-Cref

Posted: 6 Sep 1998

See all articles by Willard T. Carleton

Willard T. Carleton

University of Arizona

James M. Nelson

Florida State University - College of Business

Michael S. Weisbach

Ohio State University (OSU) - Department of Finance; National Bureau of Economic Research (NBER); European Corporate Governance Institute (ECGI)

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Abstract

This paper analyzes the process of private negotiations between financial institutions and the companies they attempt to influence. It relies on a private database consisting of the correspondence between TIAA-CREF and 45 firms it contacted about governance issues between 1992 and 1996. This correspondence indicates that TIAA-CREF is able to reach agreements with targeted companies over 95% of the time. In over 70% of the cases, this agreement is reached without shareholders ever voting on the proposal. We verify independently that at least 87% percent of the targets subsequently took actions to comply with these agreements.

JEL Classification: G31, G32, G34

Suggested Citation

Carleton, Willard T. and Nelson, James M. and Weisbach, Michael S., The Influence of Institutions on Corporate Governance Through Private Negotiations: Evidence from Tiaa-Cref. Journal of Finance, Vol. 53, August 1998. Available at SSRN: https://ssrn.com/abstract=121267

Willard T. Carleton

University of Arizona

Department of History
Tucson, AZ 85721
United States

James M. Nelson

Florida State University - College of Business ( email )

423 Rovetta Business Building
Tallahassee, FL 32306-1110
United States
850-645-0166 (Phone)

Michael S. Weisbach (Contact Author)

Ohio State University (OSU) - Department of Finance ( email )

2100 Neil Avenue
Columbus, OH 43210-1144
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

European Corporate Governance Institute (ECGI) ( email )

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

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