Interventions by Common Owners

Abstract

Common ownership exists when investors concurrently hold partial and significant shares in related firms. In this paper, I compile, document, and taxonomize 30 separate cases of intervention to demonstrate how common owners influence firm behavior. Although previous literature has identified a link between common ownership and product market outcomes, critics have questioned a common owner's ability and incentive to alter the behavior of portfolio firms. Missing from the debate are observable interventions from common owners and the mechanisms through which common owners exercise their influence. This paper compiles relevant case studies from media coverage, regulatory proceedings, policy groups, and annual stewardship reports to uncover these channels.

Keywords: Common ownership, mechanisms, intervention, governance, horizontal, shareholdings, institutional investors

JEL Classification: D43, G11, G20, G30, G32, G34, K20, L10, L21, L22, L40