Institutional Investors, Corporate Governance, and Stewardship Codes

As stewardship by institutional investors is an integral part of an adequate system of corporate governance, the growing diffusion of stewardship codes can be seen as a principal reaction to institutional investors’ reticence in monitoring the companies they invest in. According to a recent survey[1], there are currently about 20 stewardship codes (or similar initiatives) in force around the world. Although all of the codes are intended to promote institutional investors’ monitoring of investee companies, as suggested by a recent study[2], these codes can be divided into three categories depending on the nature of the entities … Read more