We investigate the economic role of proxy advisors (PA) in the context of mandatory “say on pay” votes, a novel and complex item requiring significant firm-specific analysis. PA are more likely to issue an Against recommendation at firms with poor performance and higher levels of CEO pay and...

We investigate the economic role of proxy advisors (PAs) in the context of mandatory "say on pay" votes, a novel and complex item requiring significant firm-specific analysis. PAs are more likely to issue an Against recommendation at firms with poor performance and higher levels of CEO pay and...

The literature on shareholder voting has mostly focused on the influence of proxy advisors on shareholder votes. We exploit a unique empirical setting enabling us to provide a direct estimate of management's influence. Analyzing shareholder votes on the frequency of future say on pay votes, we...