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SHAREHOLDERS AND CORPORATE GOVERNANCE   Research Agenda & Conference

By Jonathan GS Koppell
Faculty Director, Millstein Center & Associate Professor of Politics and Management, Yale SOM

   In the seventy-five years since Berle and Means considered the separation between ownership and control in large business organizations, markets around the world have experienced continuous change in securities statutes, corporation laws, investor profiles, trading systems, management of investment capital, distribution of ownership rights, information technologies, and the structure of enterprises themselves.  The pace and power of change is accelerating, giving rise to demand for insights that can inform decision making among players such as regulators, lawmakers, corporate directors and investment professionals.

   With the generous support of Broadridge, the Yale School of Management’s Millstein Center and the University of Oxford’s Saïd Business School co-sponsored a conference to consider the consequences of these changes in comparative perspective.  In response to an open call, ten papers were selected for presentation in October 2007 at Oxford University.

  Collectively the papers considered the evolving role of shareholders in the governance and performance of the corporation.  They did so by focusing on specific aspects of the shareholder's relationship to the corporation.  From hedge fund activism to shareholder voting to private litigation as an enforcement strategy, the topics provide an indication of the breadth of issues to be considered in future corporate governance research.

   The most striking cross-cutting theme of the conference concerned the complex role of institutional investors in corporate governance.  Several studies demonstrated the potential positive impact institutional investors can have on corporations, on compensation and overall performance through interaction with management and even proxy proposals.  But the papers also reveal conflicts of interest inherent in the position of some institutional investors, such as mutual funds.  For example, there are times when investors face conflicts between their fiduciary obligation and business interests.  Thus the papers as a whole call attention to the importance of an in-depth understanding of the different types of institutional investors, and their impact, as the study of corporate governance moves forward.

   The conference facilitated constructive exchanges between scholars in the international corporate governance field.  Conference versions of many of the papers are now available on the Millstein Center website, as are brief one paragraph summaries of the paper topics.   Final versions are expected to be published in various academic outlets.

   Many of the Yale-Oxford papers proved path breaking in their ambitions and germane to important corporate governance policy debates. Where appropriate, the Millstein Center served as a bridge between scholar-authors on the one hand and policy makers and market players on the other.  Resulting two-way exchanges carried mutual benefits. Researchers aiming to extend or finalize studies gained access to timely sources of information and perspective, while practitioners were able to shape stances with latest empirical analysis.

To read conference versions of the papers, or the brief paper summaries, please visit : http://millstein.som.yale.edu/oxfordpapers.shtml

To comment on this article, please visit the Center’s Discussion board at: http://millstein.som.yale.edu/forum/