Over the last two decades, the dramatic increase in institutional investors’ ownership of rival companies has raised questions about collusive corporate policies. However, it is still unclear how common shareholders engage with and influence corporate decision-making, especially when it comes to antitrust issues (Ginsburg and Klovers, 2018; Scott Morton and Hovenkamp, 2017; Hemphill and Kahan, 2019).
One frequently mentioned mechanism is board representation (Azar 2021; Eldar, Grennan, and Waldock, 2021). Its plausibility rests on the well-settled principle in U.S. corporate law that directors are responsible for making all major corporate decisions (Bebchuk, 2004). Given their considerable ownership stake … Read more