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Home | Events Archive | The Costs and Benefits of Shareholder Democracy

The Costs and Benefits of Shareholder Democracy

  • Speakers
    Nickolay Gantchev (Southern Methodist University, United States)
  • Field
  • Location
    University of Amsterdam, Roeterseilandcampus, Building M
  • Date and time

    April 25, 2019
    13:00 - 14:15

We show that, while low-cost shareholder activism via shareholder-sponsored proposals is occasionally value-enhancing, many proposals are submitted by the same few individual investors and other sponsors without organizational capabilities to analyze a large number of firms. These proposals, if approved and subsequently implemented, appear to destroy shareholder value. Firms whose shareholders are more likely to collect information before voting benefit from low-cost shareholder activism because these investors weed out low-quality proposals. We conclude that an informed shareholder base is crucial for firms to take advantage of low-cost shareholder activism.

Please register by email, if you want to attend the seminar