TRANSPARENCY OF INSTITUTIONAL INVESTORS, ASSET MANAGERS AND PROXY ADVISORS

2021 ◽  
pp. 142-142
Keyword(s):  
Institutional Investors ◽  
Proxy Advisors ◽  
Asset Managers

Interessenkonflikte bei kollektiven Vermögensverwaltern und Stimmrechtsberatern

2021 ◽  
Author(s):  
Nicholas P. Schoch
Keyword(s):  
Institutional Investors ◽  
Conflicts Of Interest ◽  
Regulatory System ◽  
Shareholder Rights ◽  
Disclosure Requirements ◽  
Proxy Advisors ◽  
Asset Managers

Based on the new disclosure requirements for institutional investors, asset managers and proxy advisors introduced in the course of the implementation of Directive (EU) 2017/828, the study deals with the participation-related conflicts of interest of collective asset managers and proxy advisors, their treatment under European and national law to date, and the regulatory system of the Shareholder Rights Directive. On this basis, the question is examined to what extent the area under research requires further regulation. The focus is on the systemisation of the previous as well as the new conflict-related regulatory concept and, following on from this, the channelling of future legislative revisions.

Disciplinary power in corporate governance: A Foucauldian analysis of the emergence and development of proxy advisors

2021 ◽  
pp. 103237322098623
Author(s):  
Damien Lambert
Keyword(s):  
Corporate Governance ◽  
Institutional Investors ◽  
Historical Analysis ◽  
General Meeting ◽  
Global Scale ◽  
Disciplinary Power ◽  
Record Keeping ◽  
Corporate Executives ◽  
Proxy Advisors ◽  
Foucauldian Analysis

Prior research in corporate governance has extensively investigated the mechanisms through which a variety of actors (financial analysts, investment managers, shareholder activists) monitor and discipline corporate executives. However, one recently emerged actor has received little attention so far: the proxy advisory firm. Mobilising Foucault’s concept of disciplinary power, this study uses historical analysis to examine the role of proxy advisors in corporate governance. This article shows that proxy advisors actively contributed to developing and implementing disciplinary mechanisms. This involves (1) hierarchical observations of corporations and their executives on a global scale. These observations are made available to institutional investors on proxy advisors’ voting platforms which have Panopticon-like features; (2) normalisation of judgements through the provision of generic voting policies, generic voting recommendations and corporate governance ratings prepared by proxy advisors and delivered to many institutional investors; (3) ritualised examination of the performance of corporations and of their executives during the annual general meeting, including record-keeping of all past voting results.

scholarly journals The Influence of Large Investment Funds

2021 ◽  
pp. 231-244
Author(s):  
Helen Campbell Pickford
Keyword(s):  
Financial Performance ◽  
Institutional Investors ◽  
Natural Capital ◽  
Active Role ◽  
Investment Funds ◽  
Asset Managers ◽  
Large Investment ◽  
The Way

The adoption of the Economics of Mutuality will depend on institutional investors promoting it through active engaged investing. Chapter 18 describes how some investment funds are taking an active role in managing the companies in which they are invested. It involves them acquiring significant blocks of shares that are held for extended periods of time and managed directly by asset owners themselves instead of by intermediary asset managers. Critical to this is the way in which the performance of their investments is monitored and measured. Alongside measuring financial performance over longer periods of time than is conventionally the case, performance needs to be assessed in relation to other indicators of performance related to human, social, and natural capital.

scholarly journals The Rise of Institutional Investors

2019 ◽  
Author(s):  
Jan Fichtner
Keyword(s):  
Mutual Funds ◽  
Hedge Funds ◽  
Institutional Investors ◽  
Private Equity ◽  
Short Term ◽  
Equity Funds ◽  
Private Equity Funds ◽  
Important Position ◽  
State Street ◽  
Asset Managers

During the last decades, institutional investors gained an ever more important position as managers of assets and owners of corporations. By demanding (short-term) shareholder value, some of them have driven the financialization of corporations and of the financial sector itself. This chapter first characterizes the specific roles that private equity funds, hedge funds, and mutual funds have played in this development. It then moves on to focus on one group of institutional investors that is rapidly becoming a pivotal factor for corporate control in many countries – the “Big Three” large passive asset managers BlackRock, Vanguard and State Street.

Improving The Mechanism For The Participation Of Banks In The Restructuring Of Joint-Stock Enterprises In The Cis.

2012 ◽  
Vol 4 ◽  
Author(s):  
Valentin Kotov
Keyword(s):  
Mechanism Of Action ◽  
Institutional Investors ◽  
Commercial Banks ◽  
Scale Up ◽  
Investment Bank ◽  
Asset Managers

This article focuses on the participation of commercial banks in the CIS in providing the investment processes of restructuring of joint-stock companies. The features of the investment bank providing various types of modernization of companies, as well as the risks associated with the implementation of their functions as consultants, institutional investors, investment brokers and asset managers, trust companies. The content of the mechanism of action of banks to scale up and improve the quality of the investment programs to ensure the restructuring of joint-stock companies.

scholarly journals Determinants of commitment and opportunism of institutional investors’ behaviour: an empirical investigation on Robo-voting Phenomenon

2021 ◽  
Vol 38 (3) ◽  
pp. 191-214
Author(s):  
NICOLA CUCARI ◽  
SALVATORE ESPOSITO DE FALCO ◽  
SERGIO CARBONARA ◽  
KONSTANTINOS SERGAKIS ◽  
DOMENICO SARDANELLI
Keyword(s):  
Institutional Investors ◽  
Analysis Of Covariance ◽  
Central Research ◽  
Shareholder Engagement ◽  
Legal Enforcement ◽  
Opportunistic Behaviour ◽  
Italian Market ◽  
Research Questions ◽  
Proxy Advisors ◽  
Practical Implications

Purpose of the paper: Recent research identifies a troubling number of institutional investors that automatically follow the advice of their proxy advisors so that they can prove to have complied with their fiduciary duties in a practice known as robo-voting. Therefore, our central research questions are: How could the characteristics of institutional investors affect robo-voting phenomenon? How could robo-voting phenomenon favour the creation of new opportunistic behaviour, changing the scope of shareholder engagement? Methodology: Our paper directly addresses these questions by using ANCOVA (Analysis of Covariance) to test the effect of characteristics of institutional investors on the dependent variable under study. We use a manually constructed sample of coverage information from 123 Annual General Meetings held by large Italian companies in the 4-year period 2015 to 2018 and the voting reports of three proxy advisors. Findings: We show that such voting based on robo-voting phenomenon is restricted to specific types of institutional investors and it may be highlighted as a negative aspect of a duty to ‘demonstrate’ engagement on the part of institutional investors. Specifically, this duty could depend on location, strategy and category of institutional investors. Research limits: We refer only to the Italian market and it may be considered as a peripheral market by investors. Practical implications: We argue that legal enforcement of the conceptual and operational spectrum of engagement duties currently sits uncomfortably upon institutional investors and proxy advisors. Originality of the paper: We think it is important to consider how to promote shareholder engagement in general in a European context and at the same time curb negative activism by some shareholders.

scholarly journals Proxy advisors: a critical analysis

2013 ◽  
Vol 11 (1) ◽  
pp. 857-863
Author(s):  
Christophe Volonté ◽  
Simon Zaby
Keyword(s):  
Institutional Investors ◽  
Critical Analysis ◽  
Conflicts Of Interest ◽  
Advisory Services ◽  
Proxy Advisors ◽  
Fresh Impetus ◽  
Increased Activity

The influence exerted by proxy advisors or proxy firms has become significantly more important over the last few years in pace with the increased activity of institutional investors. Recently, the adoption of a Swiss referendum has given fresh impetus to this development, concerning also international stockholders in the country. Spill-over effects to the regulations of neighbor countries are not unlikely. Given this context, it is essential that the role of proxy advisory services and the associated stakeholders be critically appraised. Substantial problems may arouse with regard to the methodology that proxy advisors apply, the conflicts of interest that they confront, the transparency of their services or the lack thereof, and the competition in their market.

Concerns About the Quality and Influence of Proxy Advisors, and Its Implications for the Preparations of the Shareholders Meeting

2021 ◽  
Vol 18 (5) ◽  
pp. 794-819
Author(s):  
Albert F. Verdam
Keyword(s):  
American Literature ◽  
Institutional Investors ◽  
Listed Companies ◽  
The State ◽  
Advisory Services ◽  
Proxy Advisors ◽  
Shed Light

After highlighting the importance of the votes cast by institutional investors in shareholders meetings of listed companies, and the role proxy advisors play in this respect, this article turns to the points of criticism that are strongly emphasized in American literature, as well as to the state of regulation on both sides of the Atlantic, also including the stern action the SEC has been taken recently with respect to proxy advisors. On the basis of a questionnaire issued to Dutch listed companies, I shed light on the perception of listed companies of the actions of proxy advisory services. I will conclude with a few reflective remarks, also about the consequences of the growing role of proxy advisors for the preparation of the shareholders meeting dynamics surrounding the shareholders meeting.

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