Shareholders & Activism

The days of the old-fashioned, two-fisted activist campaigns may be numbered, writes Bruce Goldfarb The new Bob Dylan biopic,A Complete Unknown, reminds me of the Nobel laureate’s often-quoted lyric: the times they are a changin’. That metaphorically holds true relative to the trends in activism, which are shifting in form and focus, heralding the start of a new, more institutionalized era. A host of factors, including leadership transitions at high-profile activist firms, a lack of ‘low-hanging fruit’ and the tendency of company boards and their adversaries to settle rather than fight, have many in the activist world wondering if the…

This week’s governance, compliance and risk-management stories from around the web – Reuters reported that, according to a Barclays report, a record number of activist shareholders launched campaigns at global companies in 2024 as their tactics produced strong returns. Further growth is likely this year. ‘Looking back to 2024, it feels almost as if there was a shareholder revolt,’ said Jim Rossman, global head of shareholder advisory at Barclays. In 2024, 160 investors such as hedge fund firms pushed companies to make moves including improving strategy and operations or firing CEOs, including 45 who used the strategy for the first…

Joseph Caruso presents a case for eliminating the OBO classification Over the last several years government agencies, institutional investors and proxy advisory firms have been seeking greater corporate transparency in public filings to build trust and improve corporate governance. However, such efforts would be better served on a level playing field because, at present, not all shareholders are required to play by the same rules of transparency. Unlike registered shareholders (record holders) who hold their shares directly with a public company, beneficial owners (street-name shareholders) hold their shares indirectly through a brokerage firm or other financial intermediary (custodian), which serves…

Measure addresses cloud operations in ‘countries of significant human-rights concern’ Almost a third of Microsoft Corporation shareholder votes have backed a proposal seeking information about certain of the company’s operations in countries that raise fears over human-rights abuses. The measure was supported by 32.03 percent of votes cast at the company’s recent AGM. Although this is not a majority, it is a level of support governance experts generally regard as significant. Specifically, the proposal asks that Microsoft’s board ‘commission a report assessing the implications of siting [the company’s] cloud datacenters in countries of significant human-rights concern and the company’s strategies…

Brady Long discusses his company’s nominated shareholder engagement program Governance Intelligence recently presented our 17th annual Corporate Governance Awards at a gala event in New York. We had the opportunity to speak with several distinguished attendees on the red carpet before the ceremony, including Elizabeth Ising, partner with Gibson Dunn. Gibson Dunn is an adviser to Visa, which took the honors for best governance around a corporate transaction. The law firm is also an adviser to PepsiCo, which was shortlisted for Governance team of the year (large cap) and won the award for best compliance and ethics program (large cap).…

Humane Society seeking update on coffee company’s ‘commitment in China and Japan’ The mood at the ESG Integration Forum – Europe in London this week was upbeat despite the huge challenges companies face from new regulation, shifting investor sentiment and geopolitical realignments. The attendees – who hold governance, sustainability and IR roles at listed companies –exchanged notes on how ESG-related expectations continue to evolve at a rapid pace and made a determined effort to focus on the opportunities as much as the risks. Unsurprisingly, the Corporate Sustainability Reporting Directive (CSRD) – which also applies to US companies with business in…

The clash with Nelson Peltz’s activist campaign has clear learnings for listed companies, say Jean Benoit Roquette Do institutional investors take into account firms’ climate exposures in setting up stock portfolios? And, if they do, what are the effects on the cost of equity of the firms they are investing in (or divesting from) and the resulting effects on the firms’ future environmental profiles? A common narrative in climate finance is that if an investor cares about the climate and a company is negatively contributing to the environment, then the investor will ‘punish’ the company by underweighting the stock in…

Proposal follows what As You Sow calls ‘an ambiguous and inconsistent shift’ Deere & Company, also known as John Deere, is asking the SEC for the go-ahead to omit a shareholder proposal from its 2025 proxy statement that seeks information about the impact of the firm’s diversity, equity and inclusion (DE&I) efforts. The proposal, filed by As You Sow, asks Deere to ‘report publicly on the effectiveness of its efforts to create a meritocratic workplace where no one is excluded from contributing to the company’s success because of an immutable characteristic, such as gender, race or ethnicity. The report should……

This week’s governance, compliance and risk-management stories from around the web – The Wall Street Journal (paywall) reported that activist investor Starboard Value said News Corp should eliminate its dual-class share structure, saying it gives too much influence to Rupert Murdoch’s family. The dual-class structure isn’t in the best interest of shareholders and doesn’t reflect best-in-class corporate governance practices, Starboard said in a letter to shareholders. It cited dynamics between chair emeritus Murdoch and his children, who are in a legal fight over control of the media company, as an example of problems related to the structure. ‘This uncertainty represents…

New analysis shows institutional shareholders are concerned about the risks it poses It’s barely news to our readers that AI continues to have a widespread impact on the capital markets, not only the wider world. But new data shows that rather than enabling new efficiencies, the technology may be posing a crisis for some investors and the companies they hold. According to figures compiled by FTI Consulting, the number of shareholder proposals that directly addressed AI in the US more than doubled from 2023 to 2024. The scope and ambition of those proposals have also grown. And when we delve…