We test the hypothesis whether a specific aspect of culturetrust in othersaffects shareholder voting behavior by substituting for costly monitoring. We find consistent evidence that the percentage of votes cast at shareholder meetings is lower in high-trust countries while the percentage of votes in support of management proposals is higher. Shocks to trust and IV regressions confirm these results. We also find that shareholder voting is more valuable in lowtrust countries, as reflected by a more positive effect on future firm performance, which suggests that managers do not exploit lower levels of monitoring when trust is high.

No abstract

No abstract