| Paper Number | KCB-WP-2025-010 |
|---|---|
| Title | Can Shareholder Engagement Decrease Volatility? The Case of K Pension Fund |
| Title(Other) | |
| Author | Jonghyeok Cho ; Byunghun Han ; Kwangwoo Park |
| Publisher | KAIST College of Business |
| Abstract | This paper examines the impact of the disclosure for active shareholder partici- pation on stock return volatility by a large pension fund. Using a quasi-natural ex- perimental design with a 2020 revision to Korea’s 5% Rule that requires investors to declare a detailed investment purpose, we show that the disclosure of active share- holder participation by Korea’s National Pension Service (NPS) decreases stock return volatility. This relationship becomes more pronounced in dividend-paying firms. Our results suggest that active shareholder engagement by a large pension fund can serve as an effective monitoring mechanism in emerging markets, even though the activism is constrained by its status as a state-affiliated institution. |
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