Search results

In seeking to extend rational choice theory from “market” to “political” behaviour, economists have encountered a paradox: namely, that the act of voting itself appears to be inconsistent with the assumption of rationality. This is true not only when self‐interest is assumed, but also when altruistic behaviour (at least in its non‐Kantian form) is allowed for. This article surveys the theoretical and empirical literature on the determinants of the decision to participate in voting, and concludes that this decision is responsive to changes in the expected benefits and costs of voting; even though the expected costs of voting must normally outweigh the expected benefits. Interpretations of this behaviour include the possibility that voters act rationally, but are misinformed about the likely effectiveness of their votes; alternatively, the electorate may include more Kantians than economists have generally been willing to admit.

Blockholders can behave opportunistically because small shareholder voting suffers from coordination problems. In this chapter, we investigate the features of small shareholder voting using a theoretical framework. Specifically, we investigate when defeating a blockholder’s resolution is optional for shareholders. Regulatory initiatives that facilitate communication between small shareholders or focus on institutional investors and corporate governance tools that alter or add the threshold in the voting game also contribute to solving the coordination problem. These corporate governance initiatives can increase the relevance of AGMs in Europe.

In this part of the research, we consider the costs of the turnout decision and evaluate whether the introduction of the Shareholder Rights Directive (2007/36/EC), which aimed at lowering voting costs, has had a positive impact on (small) shareholder attendance. For this, we investigate turnout rates in Belgium, France and the Netherlands. We find strong indications that the Shareholder Rights Directive indeed had a positive impact on (small) shareholder attendance in these countries. The findings of this study may encourage policy makers to further reduce the costs of (cross-border) voting. It shows that the introduction of the new Shareholder Rights Directive may contribute to (small) shareholder engagement.

This chapter investigates which factors contribute to (small) shareholder attendance using a hand-collected panel data set with information about turnout rates, voting behaviour and ownership structures of companies that are listed in seven Member States. We document how ownership concentration positively affects total shareholder turnout, but has a negative effect on small shareholder turnout. Voting power also affects small shareholder turnout rates; the greater small shareholder voting power, the greater their eagerness to vote. In addition, total and small shareholder turnout is higher the more important the meeting agenda. And, small shareholders tend to free-ride on large institutional shareholders and corporate insiders, but the magnitude of the free-rider effect is larger for the latter category of blockholders. Our results provide some important insights for the debate on shareholder rights and the role of the AGM in corporate governance. The results show that, despite the criticism, the AGM still plays an important role in small shareholder monitoring. Some topics seem to clearly motivate small shareholders to attend, while others are less relevant. Policy makers can stimulate shareholder monitoring by focusing on the factors that are determined in this study, but it is important to consider possible endogeneity issues as well.

To provide practitioners of information management with an overview and framework to explore the various controversies associated with the methods of traditional methods of voting with electronically enhanced voting via the internet (I‐voting). The current paper is centered on the assumption that I‐voting is the next logical step in applying online information‐gathering and retrieval technologies to the field of e‐government.

A review of the applied literature on electronically enhanced voting methods with potentials associated with internet voting, as well as from practical experience, resulted in a basic model for discussion of the emergent nature of I‐voting.

I‐voting would reduce the cost for staffing polling stations, and also the funds needed to pay for voting machines. I‐voting could also reduce the number of errors made by both the voters and the electoral administrators, and allow for easier adoption of uniform standards in the ballot format, since it could be transmitted via the internet from a central election agency to all local and regional polling places. Bridging the digital divide and internet security issues may be the most important barriers that must be overcome if I‐voting becomes a viable option in the USA.

It may be years, if ever, before a truly secure, relatively risk‐free internet service, such as I‐voting, is developed. However, despite the controversies associated with election fraud, the numerous current voting systems that are in place suffer from the same problems associated with online informational exchanges; but, for the most part, nations still conduct their businesses and the political systems are still relatively stable.

Owing to recent voting débâcles in the USA, the public is demanding a more reliable and secure method of voting. Currently, many nations are moving more toward electronically enhanced voting methods with the long‐term goal being internet voting. Unfortunately, there are heated debates about the pros and cons of handing over the right to vote, using a system that is prone to security risks from outside sources.

In the short term, there should be increased interest in establishing national and international standards for testing and certification of electronic and I‐voting systems and their IT‐infrastructure. It is a basic premise of the present study that voting online increases voter participation, which can only be viewed in a positive light.

This chapter is a case study of the valuation of voting rights in France and Italy. New regulations, France’s “Florange Law” as well as Italian Legislative Decree 91/2014, have created additional voting rights attached to the existing shares of long-term shareholders. The chapter tests whether stock price evolution is consistent with the valuation of voting rights as per existing research.

Results show that stock prices of the float do not factor in the dilution created by loyalty voting rights. The chapter argues that the dilutive effect of the new regulations has a negative impact on stock valuation, but that this is more than offset by taking into account real options. These results address the concern that the new policies would depress stock valuation in France and Italy.

In this part of the book, we investigate the practical characteristics of AGMs in an extensive empirical analysis. For this, we consider the turnout rates of AGMs of seven European Member States between 2010 and 2014 in this chapter. We show that, although there are large differences in total and small shareholder turnout rates among Member States, there is an overall increasing trend in the 2010–2014 period. In contrast to what economic theory predicts, a substantial and increasing part of small shareholders actually participate in AGMs.

This chapter investigates voting decisions by mutual funds in a variety of management-sponsored proposals in Israel. Our main findings are that mutual fund managers tend to vote with management and oppose only about 30 percent of all potentially harmful proposals. Larger equity holdings by the fund manager and better prior performance by the firm are found to be negatively associated with the odds of voting against management. Also, mutual funds managed by banks are found to exhibit better monitoring than mutual funds managed by private investment companies. We find that bank fund managers are more likely to vote against management than other mutual fund managers. We further find that non-bank funds tend to increase equity holding following the meeting regardless of their vote, whereas bank funds tend to follow the “Wall Street Rule” and reduce their equity holdings after voting against management.

This paper aims to explore the problem of power imbalance within decentralized autonomous organizations (DAOs) and propose potential solutions that could contribute to enhancing the democratic nature of DAOs.

In this paper, the authors apply a qualitative methodology. Using a thematic coding analysis, the authors process data collected from interviews with 11 experts.

Multiple factors contribute to the perceived lack of democracy within DAOs, such as token concentration and effective stakeholder communication. Next, quadratic voting has the potential to enhance democracy within DAOs, but this mechanism must be implemented mindfully. Finally, the results were nuanced when it comes to the effectiveness of liquid democracy in DAOs to enhance voter participation and representation.

To the best of the authors’ knowledge, this paper is one of the first research contributions to propose recommendations to address the power imbalance within DAOs and to contribute to the advancement of decentralized decision-making structures.