The market impact of shareholder voting : an event study of global AGMs

Corporate governance decisions made at annual general meetings (AGMs) have gained increased attention in recent years, particularly in connection with environmental, social and governance (ESG) concerns. These votes serve as signals that can influence market perception. Once considered a formality, AGM votes have become powerful indicators of shareholder sentiment regarding a company’s strategic direction, governance practices and sustainability efforts. Against this background, this paper analyses whether AGMs and their voting outcomes convey new, significant information that affects stock prices or whether these outcomes largely reflect expectations already priced into the market. Using an event study methodology, this thesis examines data from 884 publicly listed companies globally, covering events that occurred between 2021 and 2024. By examining daily abnormal returns (AR) and cumulative abnormal returns (CAR) within a defined seven-day event window surrounding the AGM, the study captures short-term market reactions. To yield more detailed insights, the dataset is segmented to explore whether market responses vary by company characteristics, agenda items, proposal types and sustainability indicators. The results offer valuable insights into share price behaviour around AGMs. Notably, a statistically significant negative CAR of -0.29% is observed when all events are considered, underscoring investor caution and uncertainty ahead of voting outcomes. Negative ARs are evident both on the day before AGMs (-0.09%) and on the AGM day itself (-0.08%), pointing to anticipated results, shareholder dissent or activist behaviour. Subcategory analyses show stronger negative CARs among medium-sized and large firms, among companies with higher free float, and in cases involving shareholder proposals or anti-ESG resolutions. These findings highlight investor sensitivity to governance controversies and sustainability risks. In conclusion, this study finds that while AGM outcomes often align with already priced-in expectations, the AGM as an event and specific subcategories still convey meaningful information. AGMs themselves have emerged as actionable signals that can influence stock prices by introducing new information to the market. Investors and managers should interpret these signals by considering the forward-looking nature of market reactions and the conditions under which AGM results materially influence investor decision-making.