Are loyalty shares an effective antidote against short-termism?

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Corporate short-termism is arguably one of the main causes of economic, social and environmental unsustainability. This paper studies the effectiveness of loyalty shares shares granting extra dividends or voting rights to shareholders holding them for a specified period of time - in limiting short-termism. The results confirm that, after loyalty shares issuance, companies manage earnings to a lower extent. Interpretation of the evidence supports the main hypothesis that loyalty shares can serve as an antidote against short termism.