Who Do You Vote For? Same-Race Voting Preferences in Director Elections

This paper highlights racial and ethnic preferences in corporate director elections. We discover that mutual fund managers are more likely to vote for director nominees who share their racial or ethnic identity, using a comprehensive dataset of mutual fund voting records. Funds managed by all-white teams exhibit the strongest same-race preference, particularly those in fund families with scarce minority representation. In contrast, minority fund managers exhibit such preference only when voting on candidates nominated to boards with little or no existing minority director representation. These disparate voting patterns have detrimental implications for the career outcomes of minority director candidates. We investigate various potential mechanisms --- including statistical discrimination, value maximization, conflicts of interest, social networks, and taste-based biases --- and find that the evidence aligns most closely with a taste-based explanation for same-race preferential voting.