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Director elections: An analysis of shareholder response to directors’ reputation and expertise
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Sylvie Berthelot 
, Michel Coulmont
This work is licensed under a Creative Commons Attribution 4.0 International License.
Abstract
The purpose of this study is to determine whether shareholders take directors’ independence, gender, expertise, and reputation into account when voting in directors’ elections. To this end, we regressed several explanatory variables representing these characteristics on the percentage of “in favour” votes cast during annual elections in 2017 for each director, based on a sample of 60 Canadian firms. Among these explanatory variables, we used two measures of their reputation, one measure of their level of education, several measures of their area of expertise, and one measure of their independence. Their reputation was assessed based on their inclusion in the Canadian Who’s Who directory and their membership on another board of directors of a Canadian public company. The other explanatory variables were collected from official company documents, especially the proxy circulars available on the Canadian Securities Administrators website. The accounting and financial variables were drawn from the Research Insights database. The results of the regression analysis indicate that although shareholders do not seem to consider directors’ reputation and expertise when casting their vote, they do take their independence and gender into account.
Keywords: Shareholder Democracy, Board of Directors’ Election, Independence, Gender, Expertise, Reputation
Authors’ individual contribution: Conceptualization – S.B. and M.C.; Methodology – M.C.; Formal Analysis – S.B. and M.C.; Resources – S.B. and M.C.; Writing – S.B.; Supervision – S.B.
Declaration of conflicting interests: The Authors declare that there is no conflict of interest.
JEL Classification: G34, G39
Received: 26.08.2020
Accepted: 10.11.2020
Published online: 16.11.2020
How to cite this paper: Berthelot, S., & Coulmont, M. (2020). Director elections: An analysis of shareholder response to directors’ reputation and expertise [Special issue]. Corporate Ownership & Control, 18(1), 346-354. https://doi.org/10.22495/cocv18i1siart9
