Finance Research Seminar – Professor Reena Aggarwal

Title: Public Sentiment Decomposition and Shareholder Actions

Date: 11 March 2026

Time: 14:00-16:00

Venue: FDC.1.17

If you would like to attend, please register using the following link

Public Sentiment Decomposition and Shareholder Actions

Speaker:   Professor Reena Aggarwal

Professor Aggarwal is a Robert E. McDonough Professor of Finance and Director, Georgetown Psaros Center for Financial Markets and Policy

https://gufaculty360.georgetown.edu/s/contact/00336000014RhE9AAK/reena-aggarwal

Abstract

Employing a novel approach with unique public sentiment data and a new metric for shareholder concerns, we find a strong relation between public sentiment and shareholder actions. We demonstrate that the number of shareholder proposals effectively captures investor dissatisfaction with a firm, particularly because it includes firms without shareholder proposals. We show that negative sentiment about financial, environmental, social and governance issues are significantly associated with more shareholder proposals, and we establish causality through an instrumental variable approach. Further, shareholder actions have real consequences as a larger number of shareholder proposals is associated with higher turnover for CEOs and directors.