Responsible ownership, shareholder value and the new shareholder activism

John Roberts, Paul Sanderson, John Hendry and Richard Barker

Working Papers from Centre for Business Research, University of Cambridge

Abstract: In this paper we use interview data to explore the new shareholder activism of mainstream UK institutional investors. We describe contemporary practices of corporate governance monitoring and engagement and how they vary across institutions, and explore the motivations behind them. Existing studies of shareholder activism mainly assume that it is motivated by a desire to maximise shareholder value, and we find some evidence both of this and of alternative political/moral motivations related to ideas of responsible ownership. We conclude, however, that in the current situation both these act primarily as rationalisations rather than as genuine motivators. The main driving force behind the new shareholder activism is the institutions own profit maximisation and the need to position themselves against competitor institutions in the context of political and regulatory changes that have significantly changed the non-financial expectations of their clients.

Keywords: corporate governance; institutional investors; shareholder value; stock market (search for similar items in EconPapers)
JEL-codes: G2 G3 G30 (search for similar items in EconPapers)
Date: 2004-12
New Economics Papers: this item is included in nep-acc
Note: PRO-2
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:cbr:cbrwps:wp297

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