Voting Rationales

61 Pages Posted: 29 Jul 2023 Last revised: 4 Mar 2024

See all articles by Roni Michaely

Roni Michaely

The University of Hong Kong; ECGI

Silvina Rubio

University of Bristol Business School

Irene Yi

University of Toronto

Date Written: July 26, 2023


Why do institutional investors vote the way they vote? Using a novel dataset on the reasoning behind investors’ voting decisions, we provide direct evidence on the main reasons for institutions’ votes in director elections. The main reasons for opposition are independence and diversity. Concerns raised in rationales reflect firms’ governance weaknesses: companies with low board gender diversity receive more rationales on diversity, similar results for independence, tenure, busyness, and CEO duality. Companies listen and address frequently raised concerns. Results reveal institutions cast informed votes, their rationales are well grounded, and can be an effective low-cost strategy to communicate investors’ concerns.

Keywords: institutional investors, voting, voting rationales, corporate governance

JEL Classification: G11, G23, G30

Suggested Citation

Michaely, Roni and Rubio, Silvina and Yi, Irene, Voting Rationales (July 26, 2023). European Corporate Governance Institute – Finance Working Paper No. 928/2023, Available at SSRN: or

Roni Michaely

The University of Hong Kong ( email )

Pokfulam Road
Hong Kong, Pokfulam HK

ECGI ( email )

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

Silvina Rubio (Contact Author)

University of Bristol Business School ( email )

Queen's Ave
Bristol, BS8 1SD
United Kingdom

Irene Yi

University of Toronto ( email )


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