Hedge Funds in Corporate Governance and Corporate Control

Vocabularies of Motive and Temporal Perspectives: Examples of Pension Fund Engagement and Disengagement

“…Bushee (1998) characterizes pension funds as 'quasi-indexers', arguing that they exacerbate incentives for myopic investment behaviour because their fragmented and passive ownership precludes them from gathering important company information, disincentivizing the monitoring of managers. A number of scholars have consistently doubted pension fund ability and inclination to act as principals and influence investee companies (Conyon and Sadler, 2010;Faccio and Lasfer, 2000;Hellman, 2005;Kahan and Rock, 2007;Webb, Beck and McKinnon, 2003). Similarly, Goergen and Renneboog (2002) argued that institutional investors in the UK are mostly passive.…”

Exploring the research fronts and main paths of literature: a case study of shareholder activism research

“…However, the findings of the research fronts have implied that shareholder activism and various institutional investor involvements did benefit from corporate governance practices of the invested firms (Chen et al 2007;Giannetti and Laeven 2009;Aggarwal et al 2011;Helwege et al 2012;Bajo et al 2013). Several studies also mentioned that hedge fund activism has influenced the wealth creation of shareholders due to its uniqueness and flexibility compared with other types of institutional investors (Kahan and Rock 2007;Clifford 2008;Klein and Zur 2009).…”

“…Romano (2003) looked at confidential voting and found no significant influence on voting outcomes and firm performance. Kahan and Rock (2007) followed Romano (2003) and indicated the uniqueness of hedge fund activism. Choi and Fisch (2008) researched California Public Employees Pension System (Cal-PERS), one of the most influential pension funds in the world.…”

“…Kahan and Rock (2007) indicated that hedge fund activism is different from traditional institutional investors, because it seeks significant change toward specific companies, has high-reward incentives for absolute returns, and faces less regulatory barriers and political constraints compared with its peers. Nevertheless, the researchers also noted that hedge funds might lead to problems due to the assumptions that hedge fund managers often pursue a ''shortterm payoff'' strategy and might seek short-term profits at the expense of long-term investors.…”

Research on the relationship among large shareholders and its economic consequences of listed companies in China

“…Recent literatures, like Maury and Pajuste (2005) show that although equal voting rights among large shareholders have a positive impact on corporate performance, the effect is subject to shareholder type. Bratton (2006), Kahan and Rock (2007), Briggs (2007), Brav, Jiang, Partnoy, andThomas (2008), and Klein and Zur (2009) provide evidence that hedge funds are more likely to persuade companies to reform in order to improve their corporate performance, because then the manager's remuneration is directly linked with fund performance. Bratton (2006), Kahan and Rock (2007), Briggs (2007), Brav, Jiang, Partnoy, andThomas (2008), and Klein and Zur (2009) provide evidence that hedge funds are more likely to persuade companies to reform in order to improve their corporate performance, because then the manager's remuneration is directly linked with fund performance.…”