Corporate responses to shareholder activism : an institutional perspective

Research on how corporations respond to the filing of shareholder resolutions that seek social change has provided low levels of explanation and inconsistent results. This paper builds on previous research that has looked primarily at corporate governance and stakeholder atrributes by examining how institutional factors may have an impact on corporate responses. Our model develops hypotheses related to the influence of issue saliency, industry responsiveness, corporate social performance and corporate governance characterists on corporate responses to the demands of shareholder activists. The hypotheses are tested using social policy share resolutions from the period 2002 through 2005. The results signal some support for the importance for the incorporation of institutional factors. Industry reponses tend to pressure other corporate members to respond positively to the demands of shareholder activists.6 page(s