| Summary: | The paper builds a picture of the motivation for, and impediments to, individual and institutional shareholder activism. We consider shareholder activism within agency theory and discuss the limitations of the annual general meeting (AGM) as a site for activism. We note that retail share ownership holdings are characteristically small. Institutional investor activism as a substitute for retail shareholder activism, to achieve informative prices, increased liquidity and lower monitoring costs, is discussed. We report Australian data on the practices of funds managers. We discuss a perceived dichotomy among institutional investors between those who are ‘relational investors’ and those who opt for a ‘hold’ or ‘exit’ strategy.
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