Tag archives: shareholder activism

Shareholder activism leads to higher rate of CEO turnover – win or lose

Shareholder activism is now a global phenomenon. Activists commonly seek to shake up the board of a target company in hopes of instilling change and increasing shareholder value. The impact on target companies can be both disruptive and enduring – often resulting in turnover among top management and in particular chief executive officers (CEOs). A … Continue reading

ISS releases 2018 Americas Proxy Voting Guidelines Updates

On November 16, 2017, Institutional Shareholder Services (ISS) released its 2018 Americas Proxy Voting Guidelines Updates (the Updates). These updates implement changes in a number of areas, with the most significant being a gender diversity policy and new criteria for determining when a director is “overboarded”. Except where indicated below, the changes are effective for … Continue reading

Activists knocking on the door

The Canadian Real Estate sector may be in for a shake-up. Reuters recently reported (here) that activists may be eyeing real estate investment trusts (REITs), and their approximate combined C$67 billion in market capitalization, as ripe targets for activist campaigns in light of: attractive prices, vulnerability in the market based on uncertainty surrounding the effects … Continue reading

Trends and predictions in Canadian proxy contests

Kingsdale Advisors (Kingsdale) recently released its annual Proxy Season Review for 2017. The report examines trends observed in 2017 and provides analysis on what the future may hold for Canadian proxy contests. The report also outlines strategic recommendations for Canadian companies. Looking back – trends from 2017 Shareholder activism: alive and well. Kingsdale reports that … Continue reading

Defamation lawsuits as a defence to shareholder activism

Activist investors engaged in proxy fights typically mount aggressive public relations campaigns in order to undermine shareholder confidence in a target company’s performance and leadership, whether through social media, online forums or by using the more traditional PR channels. In response, target companies have turned to a number of defensive measures, many of which have … Continue reading

Investors heating up the conversation on climate change

Shareholders are placing increased value on non-financial factors when making investment decisions. Some of these factors are environmental and social issues. In particular, shareholder proposals on climate change have recently gained some traction. In 2016, a record breaking number of climate change resolutions were filed. This shift in focus is attributed to the 2015 Paris … Continue reading

Social media: shareholder activism in 140 characters or less

Social media has changed how we live. We have access to extensive information and global connections at our finger tips.  Given its already well-established presence in our personal lives, it comes as no surprise that social media has become a popular platform for campaigning activists.  In fact, 2017 marks one decade since an individual shareholder … Continue reading

Trends and strategies for companies involved in M&A transactions

In a report entitled “M&A Activism: A Special Report”[1] (the Report), the editor-in-chief of Activist Insight describes the types of companies most at risk of being targeted by shareholder demands, providing steps that can be taken to increase the resilience of M&A transactions. The Report identifies a number of trends and findings, as summarized below: … Continue reading

Fasten your seatbelts: preparing for the globalization of hedge fund activists

Activist hedge funds have grown up and gone global, reinforcing the need for companies of all shapes and sizes to plan ahead for the possibility of an attack. A recent article by Martin Lipton in the Harvard Law School Forum of Corporate Governance and Financial Regulation reviews recent developments in the activist landscape and reconfirms … Continue reading

The drivers and consequences of settlement agreements in proxy fights

Activist interventions are being increasingly resolved by way of settlement agreements, with 3% of activist interventions in 2000 having resulted in a settlement agreement versus 16% in 2011.[1] In light of this emerging trend, the Columbia Business School recently published a paper, Dancing with Activists, in which the authors sought to provide the first systematic … Continue reading

Members of Special Situations team weigh in on Canadian activism in Ethical Boardroom Magazine

Members of Norton Rose Fulbright’s Canadian Special Situations team have weighed in on shareholder activism in Canada with an article in the Spring Edition of Ethical Boardroom Magazine. The article, written by Trevor Zeyl (assisted by Joe Bricker), offers insights on shareholder activism in Canada in the past year, and some predictions for 2017 and … Continue reading

Court dismisses petition for a court-ordered shareholders meeting with independent chair in lieu of a meeting requisitioned by shareholders

In a dispute between three petitioning directors (the Petitioners) and three requisitioning shareholders (two of whom were also directors) (the Requisitioning Shareholders) of Photon Control Inc. (Photon) (TSX-V: PHO), the Petitioners asked the British Columbia Supreme Court (the Court) to exercise its powers under the Business Corporations Act (British Columbia) (the Act) to intervene in … Continue reading

An age of shareholder empowerment

In a corporate directors survey (the Survey) entitled “The swinging pendulum: Board governance in the age of shareholder empowerment”, PricewaterhouseCoopers LLP (PwC) presents current trends in investor influence and their impact on governance practices of boards and management teams. Conducted amongst 884 company directors in the summer of 2016 with respondents representing over 24 industries, … Continue reading

Corporate governance at top of mind for investors

A recent article from IR Magazine, “Governance crucial factor for nine in ten Canadian investors” (the Article), highlights just how much emphasis Canadian investors place on good corporate governance. Canadian companies would be smart to take heed and ensure their corporate governance is in line with accepted good practices. The Article reports that, of the … Continue reading

Emerging trends: Activist shareholder bans

As a result of the rising tide of shareholder activism in Canada, a number of defensive tactics have been developed by corporate management. The newest innovation in management’s arsenal is the activist investor ban—an agreement between an issuer and a purchaser that restricts the purchaser from transferring its shares to activist investors. Activist investor bans … Continue reading

The Dissatisfied Institutional Investor: Intervene or Exit?

Considering the role of institutional investors in influencing corporate governance is critical to effective corporate decision making. Broadly, dissatisfied institutional investors choosing to act can do one of the following: (a) intervene with management, either cooperatively or uncooperatively as dissident shareholders, or (b) exit by selling their shares. Many theories have been put forward to … Continue reading

Beyond Governance – A Canadian perspective on pre-empting activism through shareholder value creation

In collaboration with The Boston Consulting Group and RBC Capital Markets, our Canadian Special Situations Team has released a paper offering a fresh perspective on defensive strategies addressing the spectre of shareholder activism. The paper argues that in developing a sound defense, good governance practices are vital, but should not be relied upon as a … Continue reading

Multiple activist campaigns on the rise as activists outnumber target companies

A corollary to the trend of rising shareholder activism is the increasing frequency with which target companies are facing multiple activist campaigns. Companies that have successfully defended activist campaigns in the past are not free to rest on their laurels – if the same issues persist, future attacks may be on the horizon. The Wall … Continue reading

Shareholder activism on the rise

According to recent studies, the rate of successful shareholder activism is on the rise. While historically high when compared to the relative ownership percentage of those campaigning, new data from North America and Europe demonstrates a climbing success rate for activist campaigns. Studies that measure shareholder activism often organize their success-rate analysis by either a … Continue reading

M&A Activism 101: Top 3 Tips for Companies

There is a wide range of issues that a board and management team must face in considering an M&A transaction in the normal course. Increasingly however, a company that is considering a potential merger or acquisition, or asking its shareholders to consider such a transaction, needs to be aware of the motivations of the stakeholder … Continue reading

2014 Q3 Proxy Update

The 2015 proxy season is fast approaching, PwC and Broadridge released a quarterly research report  which reviews proxy related data from 4,113 shareholder meetings held between January 1 and June 30, 2014 and  highlights several themes and trends that may inform how shareholders and companies will interact on four key issues: Director Elections: Director elections continue to attract widespread … Continue reading

Trends and Predictions in Canadian Proxy Contests

Kingsdale Shareholder Services has released its 2014 Proxy Season Review.  In its report, Kingsdale discusses trends observed in 2014, predictions for the future, and gives its key recommendations for companies in the Canadian marketplace.  In reviewing 2014 and comparing it to the previous year, Kingsdale observes: By the numbers – the total number of proxy … Continue reading
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