Delegated Shareholder Activism
Dan Bernhardt and
Shaoting Pi
Additional contact information
Shaoting Pi: Iowa State University
QAPEC Discussion Papers from Quantitative and Analytical Political Economy Research Centre
Abstract:
Hedge fund activists often aim to convince other shareholders to vote for a particular corporate policy, while majority shareholders recognize that activist recommendations serve their own interests, not necessarily maximizing firm value. We show how an activist can increase the likelihood of a favorable vote by delegating the tasks of acquiring information and making recommendations to another activist. This choice balances motivating the delegated activist to acquire costly information against ensuring shareholders trust the recommendation. We characterize how the hedge fund activist’s bias affects the delegation bias, information acquisition, recommendation and shareholder voting decisions, and firm value. JEL Codes: D72 ; G23 ; G34 ; D83 ; K22
Keywords: Hedge Fund Activism; Delegation; Information Acquisition; Recommendations; Shareholder Voting (search for similar items in EconPapers)
Date: 2024
New Economics Papers: this item is included in nep-cdm
References: Add references at CitEc
Citations:
Downloads: (external link)
https://warwick.ac.uk/fac/soc/economics/research/c ... _qapec_bernhardt.pdf
Related works:
Working Paper: Delegated Shareholder Activism (2024) ![Downloads](/downloads_econpapers.gif)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:wrk:wqapec:22
Access Statistics for this paper
More papers in QAPEC Discussion Papers from Quantitative and Analytical Political Economy Research Centre Contact information at EDIRC.
Bibliographic data for series maintained by Margaret Nash (m.j.nash@warwick.ac.uk).