Akyol, A.C., Lim, W.F., and Verwijmeren, P. (2012) Shareholders in the boardroom: Wealth effects of the SEC’s proposal to facilitate director nominations. Journal of Financial and Quantitative Analysis, 47(5), pp. 1029-1057. (doi:10.1017/S0022109012000373)
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Publisher's URL: http://dx.doi.org/10.1017/S0022109012000373
Current attempts to reform financial markets presume that shareholder empowerment benefits shareholders. We investigate the wealth effects associated with the SEC’s rule to facilitate director nominations by shareholders. Our results are not in line with shareholder empowerment creating value: the average daily abnormal returns surrounding events that increase (decrease) the probability of passage of the proposal are significantly negative (positive). Furthermore, given an increase in the probability of passage of the proposal, firms whose shareholders are more likely to use the rule to nominate directors experience more negative abnormal returns.
|Glasgow Author(s) Enlighten ID:||Verwijmeren, Professor Patrick|
|Authors:||Akyol, A.C., Lim, W.F., and Verwijmeren, P.|
|College/School:||College of Social Sciences > Adam Smith Business School > Accounting and Finance|
|Journal Name:||Journal of Financial and Quantitative Analysis|
|Publisher:||Cambridge University Press|
|Published Online:||14 June 2012|