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Block Diversity and Governance

SSRN, ISSN: 1556-5068
2021
  • 0
    Citations
  • 3,296
    Usage
  • 7
    Captures
  • 0
    Mentions
  • 0
    Social Media
Metric Options:   Counts1 Year3 Year

Metrics Details

  • Usage
    3,296
    • Abstract Views
      2,917
    • Downloads
      379
  • Captures
    7
  • Ratings
    • Download Rank
      160,446

Article Description

We show that different kinds of blockholders drive different forms of corporate governance. Nonfinancial blockholders are six times more likely to self-identify as active shareholders relative to financial blockholders. Textual analysis of regulatory filings reveal that nonfinancial blocks intend to govern through voice rather than exit. Firms with nonfinancial blockholders are more likely to have corporate governance practices that reflect active governance through shareholder voice rather than the threat of exit. We document a strong positive announcement return for nonfinancial blockholders, especially in small, volatile, and illiquid firms where the marginal benefit of monitoring via voice may be larger.

Bibliographic Details

Ryan D. Israelsen; Miriam Schwartz-Ziv; James Peter Weston

Elsevier BV

Multidisciplinary; Blockholders; Shareholders; Governance; 13D Filings; 13G filings; Textual analysis; Russell discontinuity

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