| Popis: |
We examine determinants and consequences of ‘virtual’ shareholder meetings (VSM). Using a pre-Covid sample of voluntary VSM adopters, we do not find that firms choose the virtual format to avoid shareholders’ scrutiny. VSM are more frequent among tech firms, and firms traditionally more engaged with shareholders, consistent with the stated objective to increase shareholder participation. Textual analysis of transcripts suggests that VSM are substantially shorter, are less likely to include a business presentation, and, when they do, such presentation is shorter and more generic. VSM are also more likely to exhibit no questions during the Q&A, but conditioned upon having a question, they exhibit the same number of questions and such questions are more negative in tone. The results are similar when using the forced adoption of VSM due to Covid for better identification, except that the properties of the business presentation do not change around such forced adoptions. This suggests that the less frequent, shorter, and more generic presentations among voluntary VSM adopters are a firm’s choice rather than a byproduct of the virtual format per se. Finally, in both samples (voluntary and forced VSM adopters) the virtual format does not appear to affect market-based proxies for the meeting’s information content (such as abnormal trading volume and absolute returns). Overall, VSM exhibit less activity on average, consistent with critics’ concerns, but such reduced activity does not appear to cause a loss in information content nor to reflect an attempt to avoid scrutiny. |
