Abstract
Three problems may discourage the use of proxy contests to challenge management and transfer corporate control. First, inefficiency in the system of proxy vote solicitation can give management a vote-getting advantage. Second, due to conflict-of-interest pressures, institutional investors may vote with management against their own fiduciary interests. Third, because some dissident proxy challenges may be 'crank' bids, with no prospect for increasing share values, dissidents may have to incur costs to signal the value of their bid to outside shareholders. Tests on a sample of 100 proxy contests from the period 1981-1985 confirm the existence of these problems.
Original language | English (US) |
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Pages (from-to) | 237-265 |
Number of pages | 29 |
Journal | Journal of Financial Economics |
Volume | 20 |
Issue number | C |
DOIs | |
State | Published - 1988 |
Externally published | Yes |
ASJC Scopus subject areas
- Accounting
- Finance
- Economics and Econometrics
- Strategy and Management