Shareholder Activism and the Deterrence Effect of Democratic Politician Shareholders

• 成果类型: Article
• 署名作者: DesJardine, Mark R.; Shi, Wei; Werner, Timothy
• 署名单位: Dartmouth College; University of Miami; University of Texas System; University of Texas Austin
• 刊物名称: ORGANIZATION SCIENCE
• ISSN/ISSBN: 1047-7039
• DOI: 10.1287/orsc.2023.17495
• 发表日期: 2025
• 关键词: CORPORATE GOVERNANCE; nonmarket/political environment; archival research: extant data

摘要

Firms strategically establish political connections in the hopes of obtaining access to resources and opportunities controlled by the state. However, little is known about benefits that may accrue to firms from ties with politician shareholders. We explore potential spillover benefits of such ties in the context of financially motivated shareholder activism (financial activism). Specifically, we examine whether financial activists are deterred from targeting firms owned by Democratic politicians, who tend to adopt a more interventionist and stakeholder-oriented stance toward economic regulation than Republi-cans. Based upon an analysis of S&P 1500 firms over a 15-year period, we find that the number of Democratic politician shareholders is negatively associated with a firm's likeli-hood of being targeted by a financial activist. This relationship is stronger when Demo-cratic politician shareholders are more publicly prominent and when firms have more Democratic-leaning boards. Our study shows that the benefits firms derive from politician shareholders spill over beyond the business-government interface into the domain of cor-porate governance.