Shareholder Activism by Institutional Investors: Evidence for CalPERS
Abstract
This study examines firm characteristics that lead to shareholder activism and analyzes the effects of activism on target firm governance structure, shareholder wealth, and operating performance for the fifty-one firms targeted by the California Public Employees' Retirement System (CalPERS) over the 1987-93 period. Firm size and level of institutional holdings are found to be positively related to the probability of being targeted, and 72 percent of firms targeted after 1988 adopt proposed changes or make changes resulting in a settlement with CalPERS. Shareholder wealth increases for firms that adopt or settle and decreases for firms that resist. No statistically significant change in operating performance is found. Copyright 1996 by American Finance Association.Download Info
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Bibliographic Info
Article provided by American Finance Association in its journal Journal of Finance.
Volume (Year): 51 (1996)
Issue (Month): 1 (March)
Pages: 227-52
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Bloch, Francis & Hege, Ulrich, 2003. "Multiple Shareholders and Control Contests," MPRA Paper 42286, University Library of Munich, Germany.
- Bo Becker & Henrik Cronqvist & Rüdiger Fahlenbrach, 2009.
"Estimating the Effects of Large Shareholders Using a Geographic Instrument,"
Harvard Business School Working Papers
10-028, Harvard Business School, revised Feb 2010.
- Becker, Bo & Cronqvist, Henrik & Fahlenbrach, Rüdiger, 2011. "Estimating the Effects of Large Shareholders Using a Geographic Instrument," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 46(04), pages 907-942, September.
- Becker, Bo & Cronqvist, Henrik & Fahlenbrach, Rudiger, 2008. "Estimating the Effects of Large Shareholders Using a Geographic Instrument," Working Paper Series 2008-9, Ohio State University, Charles A. Dice Center for Research in Financial Economics.
- Becker, Bo & Cronqvist, Henrik & Fahlenbrach, Rüdiger, 2008. "Estimating the Effects of Large Shareholders Using a Geographic Instrument," SIFR Research Report Series 64, Institute for Financial Research.
- Bo Becker & Henrik Cronqvist & Rüdiger Fahlenbrach, 2011. "Estimating the Effects of Large Shareholders Using a Geographic Instrument," NBER Working Papers 17393, National Bureau of Economic Research, Inc.
- Cronqvist, Henrik & Fahlenbrach, Rüdiger, 2007. "Large Shareholders and Corporate Policies," SIFR Research Report Series 60, Institute for Financial Research.
- Officer, Micah S., 2011. "Overinvestment, corporate governance, and dividend initiations," Journal of Corporate Finance, Elsevier, vol. 17(3), pages 710-724, June.
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