Essays on director connections in the mutual fund industry

The executives of publicly traded firms often sit on mutual fund boards. This dissertation explores the influence these executives exert on the investment, proxy voting and contracting decisions of the fund. It shows that funds concentrate their holdings in and trade informatively in the stock of the executive’s firm, and that fund proxy votes support the management of the executive’s firm. Furthermore, the dissertation presents evidence that these effects are interrelated, consistent with an exchange of favors occurring between the fund, firm and director. It finds that when funds trade informatively in the executive’s firm, the fund is more likely to retain the executive on its board, and more likely to cast proxy votes that support the firm’s management. These results are robust to controlling for fund and firm specific factors and suggest that the influence of fund directors extends beyond their formal monitoring responsibilities.Ph. D.Includes bibliographical referencesIncludes vitaby Paul Calluzz