Institutional and company specific determinants of international institutional investors' tendency to vote at general assemblies

Abstract

Institutional and Company Specific Determinants of International Institutional Investors' Tendency to Vote at General Assemblies What determines the tendency of international institutional investors to participate in the general assemblies of companies they invest in and cast their vote? Using a sample of 62 countries, we show that measures of investor protection, better disclosure, stronger property rights protection and judicial efficiency positively affect these tendencies. We also show that, in a sample of ISE listed companies, institutional investors cast a higher fraction of their votes in larger companies, in companies with an MSCI membership and a cross-listing. Firm-specific measures of transparency and disclosure also influence the voting behavior These effects change with the fraction of closely held shares.