Shareholder Proposals to Rescind Poison Pills: All Bark and No Bite?

IF 2.8 Q2 BUSINESS

Corporate Communications Pub Date : 1996-03-01 DOI:10.2139/ssrn.1352

Christopher J. Marquette, John M. Bizjak

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引用次数: 15

Abstract

We provide evidence on the incidence and effectiveness of shareholder monitoring by examining shareholder proposals to rescind poison pills. Our research indicates that shareholders present resolutions when they are more likely to increase the value of the firm. We find that pill rescission proposals are submitted more frequently when firm performance has been poor, when the initial market reaction to the adoption of the pill is negative, and when insider and block ownership of stock is low. In addition, pill rescission proposals receive more support when performance is poor and when the pill has characteristics that increase its potential for misuse by management. Unlike some previous studies, we find evidence that shareholder monitoring is effective. Poison pills are more likely to be restructured or rescinded when there is a shareholder resolution concerning the pill. In addition, once a pill rescission proposal is presented, the firm is more likely to restructure or rescind the poison pill if the initial market reaction to the pill adoption was negative and if the proposal was submitted by a pension fund. Overall, our results support the idea that shareholder proposals, despite the fact that they are non-binding, can be an effective mechanism in managerial oversight and an important component of the governance process of the firm.

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股东提议废除毒丸:只叫不咬?

我们通过审查股东撤销毒丸的建议，为股东监督的发生率和有效性提供证据。我们的研究表明，当股东更有可能增加公司价值时，他们就会提出决议。我们发现，当公司业绩不佳、市场对采取药丸的最初反应是负面的、以及内部人和大股东持股比例较低时，药丸撤销建议的提交频率更高。此外，当药品表现不佳，或者药品有可能被管理层滥用的特点时，撤销药品的建议会得到更多的支持。与之前的一些研究不同，我们发现了股东监督有效的证据。如果股东通过决议，毒丸计划更有可能被重组或撤销。此外，一旦提出废除毒丸计划，如果最初市场对该计划的反应是负面的，并且该计划是由养老基金提出的，那么该公司更有可能进行重组或废除毒丸计划。总体而言，我们的研究结果支持这样一种观点，即尽管股东提案不具有约束力，但它可以成为管理监督的有效机制，也是公司治理过程的重要组成部分。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Corporate Communications BUSINESS-

CiteScore

3.90

自引率

20.00%

发文量

期刊介绍： Corporate Communications: An International Journal addresses the issues arising from the increased awareness that an organisation''s communications are part of the whole organisation, and that the relationship an organisation has with its external public requires careful management. The responsibility for communications is increasingly being seen as part of every employee''s role and not simply the function of the marketing/PR departments. This journal will illustrate why communications are important and how best to implement a strategic communications plan.