Institutional investors are crucial for the successful operation of speculative companies listed on the Alternative Investment Market (AIM), and it is therefore critical that their relationship is strong. However, there is limited research on this topic. The purpose of this research is to critically evaluate how institutional investors affect the decision making process of corporate managers in these companies, and how corporate governance can be affected.
The study used a qualitative research design through a case study based on a biotechnology company. Interviews with company directors and secondary resources were implemented to enhance the understanding of the research and tested through empirical research. Moreover, review of the literature was explored as a framework to support the analysis of this thesis.
The findings indicate that even though corporate governance is not compulsory for AIM listed companies, it is highly encouraged and has a positive impact in establishing trust and credibility. Furthermore, in a speculative business, institutional investors revealed a limited interest towards intervening in company governance because of their long-term investment orientation, in addition, they have confidence in the company strategy and management.
The findings indicate that corporate managers are not concerned with maximizing the short-term value of institutional investors. The decision making process is focused on maximizing the long-term value of its shareholder. The research suggests that corporate governance is a channel to create ‘intangible value’ and ‘add value’ to shareholders, enhancing confidence and trust in the board of directors.
Moreover, by effectively managing the investor relations process, corporate managers are capable of managing market expectations. From managerial perspective, this work demonstrates the importance of corporate managers in setting and communicating a clear business strategy by effectively managing investor relations and by incorporating good practices such as corporate governance.
Citación recomendada (normas APA)
Vanessa Toro Andrade, "The relationship between institutional investors and corporate managers: a case study of a speculative company", -:-, 2016. Consultado en línea en la Biblioteca Digital de Bogotá (https://www.bibliotecadigitaldebogota.gov.co/resources/2087773/), el día 2025-05-21.
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