Investors' Attention to Corporate Governance

70 Pages Posted: 27 Apr 2018 Last revised: 15 Mar 2019

See all articles by Peter Iliev

Peter Iliev

Pennsylvania State University - Department of Finance

Jonathan Kalodimos

Oregon State University - College of Business

Michelle Lowry

Drexel University

Date Written: March 6, 2019

Abstract

Using unique data on investor views of EDGAR company filings, we document that many investors devote significant effort towards governance research: the five largest mutual fund families access proxy statements of 29% of their portfolio firms. However, investors’ monitoring is focused disproportionately on large firms, firms with low managerial entrenchment, and firms with meetings outside the busy spring proxy season. Passive indexer investors perform less research. Concentration of investor attention within the same firm meetings results in joint monitoring of a relatively small subset of firms. This attention is related to investors’ voting and investment decisions.

Keywords: Corporate Governance, Governance Research, Agency, Institutional Investors, ISS

JEL Classification: G30, G34

Suggested Citation

Iliev, Peter and Kalodimos, Jonathan and Lowry, Michelle B., Investors' Attention to Corporate Governance (March 6, 2019). 9th Miami Behavioral Finance Conference 2018. Available at SSRN: https://ssrn.com/abstract=3162407 or http://dx.doi.org/10.2139/ssrn.3162407

Peter Iliev

Pennsylvania State University - Department of Finance ( email )

348 Business Building
University Park, PA 16802
United States

Jonathan Kalodimos

Oregon State University - College of Business ( email )

Corvallis, OR 97331
United States

Michelle B. Lowry (Contact Author)

Drexel University ( email )

Philadelphia, PA 19104
United States
215-895-6070 (Phone)

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