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EconPapers FAQ Archive maintainers FAQ Cookies at EconPapers Format for printing The RePEc blog The RePEc plagiarism page Large Shareholders and Corporate PoliciesHenrik Cronqvist and Ruediger FahlenbrachNo 60, SIFR Research Report Series from Institute for Financial ResearchAbstract:We develop an empirical framework that allows us to analyze the effects of heterogeneity across large shareholders, using a new blockholder-firm panel data set in which we can track all unique blockholders among large public U.S. firms. We find statistically significant and economically important blockholder fixed effects in investment, financial, and executive compensation policies. This evidence suggests that blockholders vary in their beliefs, skills, or preferences. Different large shareholders have distinct investment and governance styles: they differ in their approaches to corporate investment and growth, their appetite for financial leverage, and their attitudes towards CEO pay. We also find blockholder fixed effects in firm performance measures, and differences in style are systematically related to firm performance differences. Our results are consistent with influence for activist, pension fund, corporate, individual, and private equity blockholders, hut consistent with systematic selection for mutual funds. Finally, we analyze sources of the heterogeneity, and find that blockholders with larger block size, board membership, or direct management involvement as officers are associated with larger effects on corporate policies and firm performance.Keywords: Large shareholders; blockholders; corporate policies; firm performance (search for similar items in EconPapers)JEL-codes: G31 G32 G34 G35 (search for similar items in EconPapers)Pages: 49 pagesDate: 2007-09-15New Economics Papers: this item is included in nep-bec and nep-cfnReferences: View references in EconPapers View complete reference list from CitEc Citations: View citations in EconPapers (4) Track citations by RSS feedDownloads: (external link) -wp60.pdf (application/pdf)Our link check indicates that this URL is bad, the error code is: 404 Not FoundRelated works:Journal Article: Large Shareholders and Corporate Policies (2009) Working Paper: Large Shareholders and Corporate Policies (2007) This item may be available elsewhere in EconPapers: Search for items with the same title.Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/TextPersistent link: :hhs:sifrwp:0060Access Statistics for this paperMore papers in SIFR Research Report Series from Institute for Financial Research Institute for Financial Research Drottninggatan 89, SE-113 60 Stockholm, Sweden. Contact information at EDIRC.Bibliographic data for series maintained by Anki Helmer (Obfuscate( 'sifr.org', 'anki.helmer' )). var addthis_config = {"data_track_clickback":true}; var addthis_share = { url:" :hhs:sifrwp:0060"}Share This site is part of RePEc and all the data displayed here is part of the RePEc data set. Is your work missing from RePEc? Here is how to contribute. Questions or problems? Check the EconPapers FAQ or send mail to Obfuscate( 'oru.se', 'econpapers' ). EconPapers is hosted by the Örebro University School of Business. 2b1af7f3a8