The two authors of this article have been on opposite sides of this debate, but both recognize that no single explanation is complete and that other factors, such as the self-interest of fund managers, the conflicts of interest faced by institutions who want to retain corporate business, cultural forces, collective action problems, and what we can call path dependence- the difficulty of changing the structure and behavior of highly evolved and specialized institutions - have causal roles in explaining shareholder passivity. The central question in research on American corporate governance is how these forces interact to produce the characteristic passivity of most American institutions.
Bernard S. Black & John C. Coffee Jr.,
Hail Britannia?: Institutional Investor Behavior Under Limited Regulation,
Mich. L. Rev.
Available at: https://repository.law.umich.edu/mlr/vol92/iss7/2