Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/191720
Authors: 
Lesmeister, Simon
Limbach, Peter
Goergen, Marc
Year of Publication: 
2019
Series/Report no.: 
CFR Working Paper 18-02
Abstract: 
We test the hypothesis whether a specific aspect of culture – trust in others – affects 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.
Subjects: 
Culture
Monitoring
Shareholder expropriation
Shareholder voting
Trust
JEL: 
G3
G19
G32
Document Type: 
Working Paper
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