Research Paper Presentation: Fabrizio Ferri

Join the Gupta Governance Institute for the third seminar in the Gupta Governance Institute Fall 2020 Research Paper Seminar Series.

This session features Fabrizio Ferri of the University of Miami.

Virtual Shareholder Meetings

Abstract:

We examine determinants and consequences of firms’ choices to conduct ‘virtual’ annual shareholder meetings prior to the eruption of Covid-19. Virtual meetings are more frequent among firms with a higher number of retail shareholders, and firms traditionally are more engaged with shareholders, consistent with the stated objective to adopt the virtual format as means to increase shareholder participation. We find little evidence that firms choose this format to avoid shareholders’ scrutiny. We then examine the effect of the virtual format on the information content of the meeting, using two sets of analyses. First, textual analysis of transcripts suggests that virtual meetings are shorter, less likely to have a question from shareholders and, conditional on having a question, have fewer questions. These differences hold when comparing virtual-only meetings to past in-person meetings from the same firms, suggesting they do not reflect firm characteristics, but, rather, the format itself. Second, we examine common market-based measures of the meeting’s information content and find higher trading volume around virtual meetings, but no differences in absolute returns, returns volatility and post-meeting frequency of analyst forecast revisions. We discuss a number of potential explanations for our preliminary findings.

Each hour-long seminar will feature one academic research paper. We strive to make the seminars as interactive as possible, within the Zoom platform. Additional detail, including the paper being presented, will be added later.

The Zoom link will be sent in advance of the seminar. To facilitate engagement, we ask all participants to keep their camera on throughout the seminar.