Proxy advisory firms wield large influence with voting shareholders. However, conflicts of interest may arise when an advisor sells services to both investors and issuers. Using a unique dataset on voting recommendations, I find that for most types of proposals, competition from a new entrant...

In a typical public company, shareholders can elect the board, appoint the auditors, and approve fundamental changes. Firms with dual class share structures (DCS) alter this balance by inviting the subordinate shareholders to carry the financial risk of investing in the corporation without...

Proxy advisory firms such as ISS or Glass Lewis play an important role in our capital markets. They advise institutional investors how to vote in shareholders' meetings and often have a dramatic influence on the outcome. Such immense power, however, has sparked concern and calls for regulation,...

This study investigates the impact of the stewardship code, which is not mandatory with legally binding regulations, on the shareholder voting activity of institutional investors. Despite the introduction of the stewardship code in the UK and some European countries, its impact on shareholder...

We present a simple framework for dual-class stock shares, in which common shareholders receive public and private cash flows (i.e. dividends and any private benefit of holding voting rights) and preferred shareholders only receive public cash flows. We isolate those two cash flows in order to...

The shareholder empowerment movement (movement) has renewed its effort to eliminate, restrict or at the very least discourage the use of dual class share structures in initial public offerings (IPOs). This renewed effort was triggered by the recent Snap Inc. IPO that utilized non-voting stock....

Voting rights are a basic shareholder-protection mechanism. Outside of the core voting requirements state law imposes (election of directors and votes on fundamental changes), federal law grants shareholders additional voting rights. But these rights introduce concomitant costs into corporate...

We show that dual-class shares can be a solution to agency conflicts rather than a result of agency conflicts. When firms with a controlling shareholder issue voting shares to fund projects, the risk of losing control rises, which can threaten the controller's private benefits. Thus, incumbents...

Motivated by the increasing influence of shareholder votes on corporate policies, we examine investors’ perceptions of activism via voting. To identify instances of activism via voting, we focus on annual meetings with at least one ballot item where a substantial fraction of shareholders is...