We show firms pay more dividends and repurchase more shares when they have higher levels of institutional ownership, even if the institutions are not activist investors. We also find evidence of an effect of institutional ownership on proxy voting, profitability, R&D, and CEO compensation. Our...

We show that corporate governance practices vary predictably across different types of blockholders. Nonfinancial blockholders are six times as likely to self-identify as active shareholders relative to financial blockholders. Textual analysis of regulatory filings reveals that nonfinancial...

Different types of blockholders govern differently. Committed (non-financial) blockholders are 6 times more likely to self-identify as active, and the language of their filings reflects governance through voice rather than exit. These differences in governance persist over a firm's life cycle....