Monitoring an owner. The case of Turner broadcasting

Clifford G. Holderness, Dennis P. Sheehan

Research output: Contribution to journalArticlepeer-review

20 Scopus citations


Turner Broadcasting illustrates how organizational mechanisms can be adapted to prevent a majority owner from imposing costs on minority shareholders through inept management or opportunistic behavior. These mechanisms involve issuing preferred stock with unusual features, concentrating its ownership among a small group of investors, allowing the new preferred shareholders to elect several directors, and requiring supramajority approval of major management decisions by a reconstituted board of directors. The alienability of the preferred stock is restricted to help insure that its ownership stays concentrated and in the hands of those with the specific knowledge and incentives to be effective monitors.

Original languageEnglish (US)
Pages (from-to)325-346
Number of pages22
JournalJournal of Financial Economics
Issue number2
StatePublished - Dec 1991

All Science Journal Classification (ASJC) codes

  • Accounting
  • Finance
  • Economics and Econometrics
  • Strategy and Management


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