The impact of the institutional and regulatory environment on shareholder voting

We document that certain features of the institutional and regulatory environment governing shareholder voting can affect the co-location of shares' voting and cash-flow rights. We show that "routine" management proposals, for which brokers can vote shares held in "street name" if investors fail to vote, receive more votes favorable to management than "nonroutine" proposals. Some proposals may pass because of a routine classification. Moreover, negative recommendations from the leading shareholder-voting advisory service are associated with fewer votes cast favorable to management. We also find voting results are related to ownership structure, the use of proxy solicitors, and other firm characteristics.