COORATIVE GOVERNANCE: INSTITUTIONAL INVESTORS
DO THEY REALLY MATTER IN THE BRAZILIAN STOCK MARKET?
Name: FILIPE MANARTE SCARAMUSSA
Publication date: 18/05/2022
Advisor:
Name |
Role |
|---|---|
| PATRÍCIA MARIA BORTOLON | Advisor * |
Examining board:
| Name |
Role |
|---|---|
| PATRÍCIA MARIA BORTOLON | Advisor * |
| VAGNER ANTONIO MARQUES | Internal Examiner * |
Summary: This study observed the existence of a relationship between the presence of different types of
institutional investors in the shareholding structure of Brazilian companies and their corporate
governance practices. The study analyzed a sample composed of 118 companies over the period
between 2010 and 2020, totaling 1298 company-year observations. An index consisting of 20
objective questions, the IPGC, was used to measure corporate governance practices adopted by
companies. The number of institutional investors present in the shareholding structure of
companies was observed, a factor not yet explored by the national literature as an explanatory
variable for corporate governance practices. The study also classified institutional investors
present among the five largest shareholders of the companies in the sample in each year
analyzed in Pension Funds, Investment Funds and Funds Managed by Financial Institution, also
observing whether the institution is of foreign or national origin and of a private or state. For
econometric analysis, descriptive statistics, Pearson`s correlation matrix, and regression models
were used, with special emphasis on the use of GMM-Sys in a robust and detailed manner. The
results show that the number of institutional investors in the company`s shareholding structure,
the participation of Pension Funds, and the participation of Foreign Investment Funds are
positively related to the IPGC, suggesting that these institutions are more effective in
monitoring the investees and seek to influence them in the search for improvements in their
corporate governance practices. In turn, the presence of Funds Managed by Financial
Institutions showed a negative relationship with the IPGC, while the state nature of some
institutional investors did not show statistical significance in relation to the IPGC. By indicating
the relationship between different types of institutional investors and the corporate governance
practices of the investees, this study contributes to a better perception of risk by investors and
other participants in the Brazilian stock market, as well as to the advancement of the literature
on the subject.
