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, the top management team, or the shareholders? In large corporations, of course, the answer is the top management team … operating under the supervision of the board. As for the shareholders, they traditionally have had no role in these sort of … operational decisions. In recent years, however, shareholders have increasingly used SEC Exchange Act Rule 14a-8 (the so …
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This paper documents how firms exercise discretion in defining affiliates and reporting public float in response to SEC regulations. I find that firms with higher expected compliance costs under Section 404 of the Sarbanes-Oxley Act (SOX) of 2002 tend to classify more shares as affiliated and...
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