Abstract
Shareholder activism, especially institutional activism, has spilled over from the US to Europe and elsewhere, changing the corporate governance landscape across the world. However, the extent of this change differs between countries, and styles of activism differ. In Europe, the American style of shareholder activism, and particularly the typical mechanism of the shareholder coalition or “wolf pack”, has not been seen to date. One reason for this is the difference in legal and regulatory environments. The same is true for other non-European countries such as China.
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Notes
- 1.
In China, A-shares include negotiable A-shares and non-negotiable A-shares. In the Chinese stock market, the former is tradable, while the latter is non-tradable. Normally, listed companies can decide the proportions of negotiable and non-negotiable A-shares, subject to the regulations of the China Securities Regulatory Commission (CSRC). Since the share structure split reform in 2005, some listed companies do not have non-negotiable A-shares.
- 2.
Institutional investors in Fig. 5.1 refer to all types of institutional investors, including Qualified Foreign Institutional Investors (QFIIs) in China. They can trade in negotiable A-shares in China’s stock market.
- 3.
The Shapley value is a function that assigns a number for each player in the universe of all possible players in a simple game on the condition that the function obeys three axioms: symmetry, carrier and additivity. The Shapley-Shubik index is based on the Shapley value and is thus simplified as the Shapley index.
- 4.
The Banzhaf-Coleman index is based on the Banzhaf index; originating from the Penrose measure, it is sometimes called the Penrose-Banzhaf index or simplified as the Banzhaf index. In his paper entitled “The Elementary Statistics of Majority Voting”, L. S. Penrose suggests that the voting power of each bloc in a voting game should be proportional to the square root of the number of voters in each voting bloc’s voting list.
- 5.
The harmonic mean is the reciprocal of the arithmetic mean of the reciprocals of the given set of observations. The formula is: \( {\left({1}^{-1}+{2}^{-1}+\cdots +{n}^{-1}/n\right)}^{-1} \).
- 6.
These two programmes can be accessed at http://homepages.warwick.ac.uk/~ecaae/index.html
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Wang, W. (2019). The Mechanism of QFIIs’ Institutional Activism in China. In: Institutional Activism in Corporate Governance. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-19577-9_5
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