Institutional Investors
Individual Investors Are Polarized, Large Funds Are Not
Despite individual investors being strongly divided on environmental, social, and governance (ESG) issues, corporate policies are largely determined by large institutional investors that adopt predominantly moderate ESG stances. In new research, Nicola Persico and Enrichetta Ravina explore this disconnect by examining the mechanisms driving the moderate ESG positions of major financial institutions and investigating potential impacts of allowing individual investors to select their own proxy voters.
The Impact of Large Institutional Investors on Innovation Is Not as Positive as One Might Expect
In a new paper, Bing Guo, Dennis C. Hutschenreiter, David Pérez-Castrillo, and Anna Toldrà -Simats study how large institutional investors impact firm innovation. The authors find that large institutional investors encourage internal research and development but discourage firm acquisitions that would add patents and knowledge to their firms’ portfolios, hampering overall innovation.
Investing in Influence: Investors, Portfolio Firms, and Political Giving
A new paper examines the relationship between the rising concentration in institutional investors' ownership of publicly traded U.S. firms and portfolio companies' political giving....
The Passive Mechanisms of Common Ownership
A new paper explores the conundrum that common ownership poses for antitrust enforcers and competition and corporate scholars and sheds light on the distinctive...
Nobel Laureate Oliver Hart on Empowering Twitter’s Shareholders
In an interview with ProMarket, Nobel laureate Oliver Hart explains why broadening our perspective on fiduciary duty beyond maximizing shareholder wealth could empower individual...
Are Large Institutional Investors Actually Effective in Getting Companies to Reduce Their CO2 Emissions?
Large institutional investors have been accused of not doing
enough to reduce CO2 emissions. However, a new study finds that firms like
BlackRock, Vanguard, and State...
Barking Up the Right Tree: How Shareholder Activists Raise Issues to Placate Large Mutual Funds
A new paper examines whether shareholder activists tailor their campaigns to persuade large institutional investors and finds that in proxy communications, activists use phrases...
It is Not Just Small Investors Who Will Be Silenced Thanks to SEC’s New Rules
Shareholder proposals are one of the most effective forms of shareholder voice in corporate America. It is one of the main channels through which...
Towards the Giant Three: The Rise and Rise of the Big Three Index Funds
The Big Three index fund managers—BlackRock, Vanguard, and State Street Global Advisors—hold a significant proportion of the stock of US public companies, and they...
Horizontal Shareholding’s Anticompetitive Effects and the Mechanisms That Produce It
Waiting for further proof of causal mechanisms before addressing the anticompetitive harm caused by horizontal shareholding is unjustified, just as it was when people...
