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Evasive Shareholder Meetings

51 Pages Posted: 17 Mar 2014 Last revised: 31 Dec 2016

Yuanzhi Li

Temple University - Department of Finance

David Yermack

New York University (NYU) - Stern School of Business

Multiple version iconThere are 2 versions of this paper

Date Written: November 3, 2015

Abstract

We study the strategic scheduling of annual shareholder meetings. When companies move their annual meetings a great distance from headquarters, they tend to experience pronounced stock market underperformance in the six months after the meeting and announce earnings below expectations over the subsequent year. Companies appear to schedule meetings in remote locations when the managers have private, adverse information about future performance and wish to discourage scrutiny by shareholders, analysts, and the media. However, shareholders do not decode this signal, since the disclosure of meeting locations leads to little immediate stock price reaction. We find that voter participation drops when meetings are held at unusual hours, even though most voting is done electronically during a period of weeks before the meeting convenes.

Keywords: Shareholder meetings, corporate voting

JEL Classification: G34, K22

Suggested Citation

Li, Yuanzhi and Yermack, David, Evasive Shareholder Meetings (November 3, 2015). Available at SSRN: https://ssrn.com/abstract=2409627 or http://dx.doi.org/10.2139/ssrn.2409627

Yuanzhi Li

Temple University - Department of Finance ( email )

Fox School of Business and Management
Philadelphia, PA 19122
United States

David Yermack (Contact Author)

New York University (NYU) - Stern School of Business ( email )

44 West 4th Street
Suite 9-160
New York, NY 10012-1126
United States
212-998-0357 (Phone)
212-995-4220 (Fax)

HOME PAGE: http://www.stern.nyu.edu/~dyermack

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