Working Paper: NBER ID: w19991
Authors: David Yermack; Yuanzhi Li
Abstract: We study the location and timing of annual shareholder meetings. When companies move their annual meetings a great distance from headquarters, they tend to announce disappointing earnings results and experience pronounced stock market underperformance in the months after the meeting. Companies appear to schedule meetings in remote locations when the managers have private, adverse information about future performance and wish to discourage scrutiny by shareholders, activists, and the media. However, shareholders do not appear to decode this signal, since the disclosure of meeting locations leads to little immediate stock price reaction. We find that voter participation drops when meetings are held at unusual hours, even though most voting is done electronically during a period of weeks before the meeting convenes.
Keywords: No keywords provided
JEL Codes: G34; K22
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Distance of meeting from headquarters (R30) | Stock performance (G17) |
| Distance of meeting from headquarters (R30) | Earnings announcements (G14) |
| Earnings announcements (G14) | Stock performance (G17) |
| Distance of meeting from headquarters (R30) | Delay of bad news disclosure (G14) |
| Timing of meetings (C41) | Voter participation (K16) |