Home bias in shareholder voting

Institutional investors’ proxy voting decisions are influenced by their geographic proximity to portfolio firms. Using a sample of over 50 million votes cast by U.S. and non-U.S. investors globally, I find that investors are more likely to vote with management at domestic firms than at foreign firms, especially when ISS disagrees with management. I further demonstrate that the home bias can be explained by local investors’ information advantage and business ties with domestic firms. These results suggest that home bias is an important determinant of proxy voting behavior, and the existence of home bias is at least partially driven by rationality-based reasons.

• Publication year

  2023

• Venue

  Social Science Research Network

• Publication date

  Unknown publication date

• Fields of study

  Not labeled

• Identifiers
  DOI 10.2139/ssrn.4629306
• External record

  Open on Semantic Scholar

• Source metadata

  Semantic Scholar

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• No concepts are published for this paper.

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