The Geography of Shareholder Engagement

In this ECCE working paper, we study the global corporate engagement activities of a large UK-based asset manager from 2006 to 2011. Using proprietary data on these activities, we find that corporate engagements "behind-the-scenes" are frequently used to change corporate behavior. We show that geography is an important determinant for the occurrence of such engagements: UK firms receive significantly more engagements than their foreign counterparts. This finding gives rise to a “home bias” in corporate engagement. We also document that the extent of successful corporate engagements is significantly higher for U.S. firms than for domestic, UK firms. Our paper has important implications for institutional investors who would like to engage with investee firms.