Shareholder Stewardship in the Netherlands: The Role of Institutional Investors in a Stakeholder Oriented Jurisdiction

34 Pages Posted: 19 Feb 2020 Last revised: 29 Apr 2020

See all articles by Christoph Van der Elst

Christoph Van der Elst

Tilburg Law School; Ghent University - Department of Business Law; European Corporate Governance Institute (ECGI)

Anne Lafarre

Tilburg Law School, Business Law Department; Tilburg Law School

Date Written: February 17, 2020

Abstract

We study institutional investors’ voice in the Netherlands, focusing on shareholder voting in particular. The Dutch Stewardship Code, developed by institutional investor platform Eumedion, came into force in January 2019, emphasises engagement and responsibilities of institutional investors in Dutch listed companies and should further boost the engagement with the investees. With a new dataset, we observe that institutional investors critically consider (non) current voting items which could negatively affect shareholder rights, like some of the amendments of the articles of association as well as remuneration packages of directors that contain insufficient or inappropriate incentives. Compared to other investors, institutional investors show significantly higher opposition rates. Particularly, Eumedion members show even higher opposition rates than other institutional investors. However, there may still be room for a stronger focus on the activities and outcomes of stewardship, including changing the behaviour of companies, and not just policy statements.

An edited version of the paper will be published as a chapter in “Global Shareholder Stewardship: Complexities, Challenges and Possibilities (Dionysia Katelouzou & Dan W. Puchniak eds, Cambridge University Press, forthcoming)

Keywords: institutional investors, stewardship code, engagement, shareholder voting, the Netherlands

JEL Classification: G23, G34, K12, M14, O16

Suggested Citation

Van der Elst, Christoph and Lafarre, Anne, Shareholder Stewardship in the Netherlands: The Role of Institutional Investors in a Stakeholder Oriented Jurisdiction (February 17, 2020). European Corporate Governance Institute - Law Working Paper 492/2020, Available at SSRN: https://ssrn.com/abstract=3539820 or http://dx.doi.org/10.2139/ssrn.3539820

Christoph Van der Elst (Contact Author)

Tilburg Law School ( email )

Tilburg, 5000 LE
Netherlands

Ghent University - Department of Business Law ( email )

Universiteitstraat 4
Gent, B-9000
Belgium

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Anne Lafarre

Tilburg Law School, Business Law Department ( email )

Tilburg, 5000 LE
Netherlands

Tilburg Law School ( email )

P.O. Box 90153
Tilburg, DC Noord-Brabant 5000 LE
Netherlands

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