Institutional block-holdings of UK firms: do corporate governance mechanisms matter?

Arif Khurshed, Stephen Lin and Mingzhu Wang

The European Journal of Finance, 2011, vol. 17, issue 2, 133-152

Abstract: Using a sample of UK firms, we find that institutional block-holding is negatively associated with directors' ownership and is positively associated with board composition, suggesting that institutional block-holders regard directors' ownership and board composition as substitute and complementary control mechanisms, respectively. We also show that UK institutional block-holders prefer smaller firms and firms with a shorter listing history. The presence of institutional block-holders is associated with smaller boards and lower trading liquidity. Finally, our results indicate that the investment preference of UK institutional block-holders varies with the level of their shareholding.

Keywords: institutional block-holding; directors' ownership; board structure; corporate governance (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (6)

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DOI: 10.1080/13518471003638658

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