Recent research suggesting that shareholders demand conservative financial reporting raises the question: Which shareholders demand conservatism? We find that higher ownership by institutions that are likely to monitor managers is associated with more conservative financial reporting. This...

We use a proprietary database of institutional investors' daily stock transactions to test the validity of a common managerial perception that transient institutions sell their stock ownership indiscriminately upon announcements of small negative earnings surprises, resulting in unwarranted...

This study examines the relation between earnings management and block ownership of same‐industry peer firms by a common set of institutional investors (common institutional ownership). This relation is important given the tremendous growth of common institutional ownership and the significant...