Institutional investors in Australia: do they play a homogenous monitoring role?

This paper examines whether the presence of institutional investors in Australian publicly listed firms has an impact on firm performance. Our findings provide evidence that institutional investors are not a homogenous group of investors and that it is important to distinguish them by investment objective and their monitoring ability to exert influence. Results show that while institutional investors taken as a homogenous group appear to play an important governance role in terms of future firm performance, our analyses of the three broad typologies of institutional investors and by their respective sub-categories reveal differing conclusions. While pressure-resistant institutional investors (i.e., independent and having only investment relationship) significantly improve the short-term performance of Australian listed firms, they do not show any long-term monitoring ability. The impact of pressure-sensitive institutional investors is less clear, which is consistent with the view that these investors have some existing and potential business ties with the investee firms. More interestingly, we find that "faceless" investors via nominee and trustee institutions play an important monitoring role in creating a long-term firm value. Results have policy implications on the monitoring abilities of institutional investors in Australia.

Assumptions of decision-making capacity: the role supporter attitudes play in the realisation of Article 12 for people with severe or profound intellectual disability

The United Nations Convention on the Rights of Persons with Disabilities (UNCRPD) was the first legally binding instrument explicitly focused on how human rights apply to people with disability. Amongst their obligations, consistent with the social model of disability, the Convention requires signatory nations to recognise that “…persons with disabilities enjoy legal capacity on an equal basis with others in all aspects of life” and mandates signatory nations to develop “…appropriate measures to provide access by persons with disability to the support they may require in exercising their legal capacity”. The Convention promotes supported decision-making as one such measure. Although Australia ratified the UNCRPD in 2008, it retains an interpretative declaration in relation to Article 12 (2, 3, 4), allowing for the use of substituted decision-making in situations where a person is assessed as having no or limited decision-making capacity. Such an outcome is common for people with severe or profound intellectual disability because the assessments they are subjected to are focused on their cognition and generally fail to take into account the interdependent nature of human decision-making. This paper argues that Australia’s interpretative declaration is not in the spirit of the Convention nor the social model of disability on which it is based. It starts from the premise that the intention of Article 12 is to be inclusive of all signatory nations’ citizens, including those with severe or profound cognitive disability. From this premise, arises a practical need to understand how supported decision-making can be used with this group. Drawing from evidence from an empirical study with five people with severe or profound intellectual disability, this paper provides a rare glimpse on what supported decision-making can look like for people with severe or profound intellectual disability. Additionally, it describes the importance of supporters having positive assumptions of decision-making capacity as a factor affecting supported decision-making. This commentary aims to give a focus for practice and policy efforts for ensuring people with severe or profound cognitive disability receive appropriate support in decision-making, a clear obligation of signatory nations of the UNCRPD. A focus on changing supporter attitudes rather than placing the onus of change on people with disability is consistent with the social model of disability, a key driver of the UNCRPD.