The Wall Street stampede: Exit as governance with interacting blockholders

• 成果类型: Article
• 署名作者: Cvijanovic, Dragana; Dasgupta, Amil; Zachariadis, Konstantinos E.
• 署名单位: Cornell University; University of London; London School Economics & Political Science; University of London; Queen Mary University London
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2022.02.005
• 发表日期: 2022
• 页码: 433-455
• 关键词: institutional investors; Competition for flow; Governance via exit; Correlated trading

摘要

The growth of the asset management industry has made it commonplace for firms to have multiple institutional blockholders. In such firms, the strength of governance via exit depends on how blockholders react to each other's exit. We present a model to show that open-ended institutional investors such as mutual funds react strongly to an informed blockholder's exit, leading to correlated exits that enhance corporate governance. Our analysis points to a new role for mutual funds in corporate governance. We examine the trades of mutual funds around exits by activist hedge funds to present empirical evidence consistent with our model. (c) 2022 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/)