Tag archives: Financial Times

Activists increase their focus on smaller issuers

Shareholder activism is often associated with campaigns involving large, high-profile issuers. Yet as the Financial Times reports in a recent article, referencing global data from Activist Insight, there has been a slight upswing this year in activism against relatively small issuers.

The data show that from the start of year to the end of July, 61 “micro-cap” companies—that is, companies with market capitalizations ranging from USD $50m to USD $250m—have been targeted by activist funds. 56 micro-cap issuers were targeted over the same period in 2015. In contrast, activism against the largest issuers has experienced a slight slowdown, with 16 … Continue Reading

Board diversity: the latest metrics and government measures

The diversity of boards has become a target of greater scrutiny. This scrutiny has come not only from activist investors seeking higher returns and better governance, but from governments and various interest groups outside the corporation. It has homed in on a variety of director characteristics, including length of tenure, age, gender, and visible minority status. This post begins by discussing some of the latest metrics on board diversity in Canada. It then looks at some of the recent measures governments and regulators have been taking to increase diversity in the boardroom.

Length of tenure

According to a Financial Times Continue Reading

Moving away from a mechanistic evaluation of board term limits

Earlier this month, Robert Pozen, senior lecturer at Harvard Business School contended that a simple reliance on board term limits as an evaluation tool of corporate performance is based on “faulty logic”.[1]

Concerns around extended tenure of directors typically include anxieties over compromised director independence and the development of a friendliness with management.

According to Spencer Stuart, the average tenure of directors in Canada rose from eight years in 2009 to nine years in 2014.

Mr. Pozen, however, highlights the disconnect in assuming that “lengthy director service means cozy relationships with management”.  He notes the high rate of … Continue Reading

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