Measuring Public Preferences on Corporate Policies

• In Event: Elections and Public Opinion in State Politics

Abstract

We estimate the public’s preferences on management and shareholder proposals. Shareholders have the right to vote on corporate policies for example, on environmental policies, such as whether a firm should reduce its carbon emissions by a certain date, social policies such as whether a pay disparity audit should be conducted by the corporation, and governance issues such as whether the chair of the board should be an independent director. Understanding the public’s preferences on these issues is essential for knowing how well corporate policies represent public opinion and how well investment managers represent the preferences of the public in their voting decisions on corporate policies. We investigate how preferences differ across the environmental, social, and governance dimensions and across demographic groups and geographic space. We then use our estimates to examine policy congruence between state-level ESG policies and the preferences of the public. Our results inform discussions about the appropriate degree of delegation of voting rights in corporate decision-making.

Authors

• Brendan Pablo Montagnes, Emory University

• Zachary F. Peskowitz, Emory University

• Suhas Aruna Sridharan, Emory University