Dimensions: 0.50 x 8.50 x 5.50 72 pages AEI Press  (Washington) Publication Date: May 1999 Paperback ISBN: 0844771430

A sea change has occurred in the world of equity ownership. In the early 1908s, institutional investors held about 36 percent of U.S. equities; by the late 1990s, that number had risen to 57 percent. Can these increasingly predominant shareholders improve the performance of the corporations they own? Should they attempt to do so?

In this book, the authors address those questions by examining the research and by interviewing senior officials from ten large mutal and pension fund organizations. They investigate the mechanics of proxy voting, the investors' views of monitoring and corporate governance, and the benefits and costs of investor activism. Despite the obvious merit of some institutional investors' concerns over corporate-governance practices, the authors find that there is not necessarily a direct correlation between shareholder activism and corporate performace.

Gile R. Downs is the coordinator of the Columbia Project on Corporate Governance and comanager of the Entrepreneurship Program at the Columbia University Graduate School of Business. Ehud Houminer is codirector of the Columbia Project and teaches at Columbia Business School. R. Glenn Hubbard is codirector of the Columbia Project, the Russell L. Carson Professor at Columbia University, and a visiting scholar at AEI.