BEGIN:VCALENDAR
VERSION:2.0
PRODID:-//Talks.cam//talks.cam.ac.uk//
X-WR-CALNAME:Talks.cam
BEGIN:VEVENT
SUMMARY:A Theory of Proxy Advice when Investors Have Social Goals - John M
 atsusaka\, USC Gould
DTSTART:20210211T130000Z
DTEND:20210211T140000Z
UID:TALK150286@talks.cam.ac.uk
CONTACT:CERF/CF Admin
DESCRIPTION:Abstract\nThis paper studies the conditions under which the pr
 oxy advice market helps and hinders corporate governance. A key assumption
  is that investors are heterogeneous\, with some focusing only on returns 
 while others also have nonpecuniary goals\, such as environmental sustaina
 bility and protection of human rights. Proxy advisory firms compete for bu
 siness by choosing a scale of production\, price\, and “slant” of advi
 ce. Heterogeneous demand creates pressure for the market to offer an array
  of advice\, but there is a countervailing force: when demand is sufficien
 tly large\, suppliers adopt a “platform” technology and consolidate in
 to a natural monopoly. Under conditions that seem empirically relevant\, t
 he platform monopolist slants its advice toward the preferences of investo
 rs with non-value-maximizing goals\, thereby steering corporate elections 
 away from value maximization. We characterize the conditions under which t
 he proxy advice market succeeds and fails\, discuss policy reforms that wo
 uld help it succeed\, and develop normative principles for assessing proxy
  advice when value maximization is not the sole objective of investors.
LOCATION:Online
END:VEVENT
END:VCALENDAR