The Regulation of Proxy Advisors

Capital Markets Law Journal 8:1 (2013), 90-107

21 Pages Posted: 9 Jun 2012 Last revised: 25 Apr 2014

See all articles by Lars Klöhn

Lars Klöhn

Humboldt University of Berlin - Faculty of Law

Philip Schwarz

Ludwig Maximilian University of Munich (LMU) - Faculty of Law

Date Written: June 7, 2012

Abstract

Proxy advisors provide institutional investors, particularly funds with widely-diversified portfolios, with recommendations for the exercise of their shareholder voting rights. This gives proxy advisors influence on the fate of stock corporations. The power of proxy advisors has attracted the attention of regulators throughout the world. The following contribution gives an overview of, and evaluates the market for, proxy advice from a law-and-economics perspective, analyzes empirical data gathered to date about their usefulness, and discusses various approaches to possible regulation.

Keywords: corporate governance, proxy advisors, ISS, Glass Lewis, shaerholder voting, shareholder activism, institutional investors

JEL Classification: K22

Suggested Citation

Klöhn, Lars and Schwarz, Philip, The Regulation of Proxy Advisors (June 7, 2012). Capital Markets Law Journal 8:1 (2013), 90-107, Available at SSRN: https://ssrn.com/abstract=2079799 or http://dx.doi.org/10.2139/ssrn.2079799

Lars Klöhn (Contact Author)

Humboldt University of Berlin - Faculty of Law ( email )

Unter den Linden 6
Berlin, D-10099
Germany

HOME PAGE: http://www.rewi.hu-berlin.de/en/lf/ls/kln

Philip Schwarz

Ludwig Maximilian University of Munich (LMU) - Faculty of Law ( email )

Ludwigstraße 29/IV
Munich, DE 80539
Germany

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