How Can Minority Shareholders Protect Their Own Interest: The Case of China Merchants Bank
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| Title | How Can Minority Shareholders Protect Their Own Interest: The Case of China Merchants Bank
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| Author | Yuan Rongli, Xiao Zezhong and Zou Hong |
| Organization | School of Business,Renmin University |
| Email | yrongli@yahoo.com.cn；hongzou@cityu.edu.hk |
| Key Words | Mutual Funds; Stakeholders; Principal-Principal Problem; Shareholder Activism |
| Abstract | We study the monitoring role played by minority shareholders (represented by institutional investors) in blocking the issuance of convertible bonds by a large bank. In doing so, we appeal to the literatures on shareholder activism and principal-principal agency problems. We show that minority shareholders can take collective actions to resist the expropriation of minority interests by controlling shareholders. Chinese institutional investors have demonstrated themselves as the monitors of corporate management, representing the rights of minority shareholders. |
| Serial Number | WP245 |
| Time | 2012-06-12 |
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