Institutional shareholder activism and limited investor attention

摘要: We investigate whether limited investor attention is a factor in the effectiveness of institutional shareholder activism. Prior research has shown that an inability market participants to allocate sufficient intellectual effort investment decision can have impact on price and volume behavior. extend this applied setting by considering California Public Employees’ Retirement System (CalPERS) focus list, whose aim improve performance corporate governance target firms. find share response being included list function stock, which turn subsequent managerial response. This suggests when scarce cognitive resource, proactive exploitation news signals be efficient activism strategy.