Forum Home Page [see Broadridge note below]

 The Shareholder ForumTM`

Fair Investor Access

This public program was initiated in collaboration with The Conference Board Task Force on Corporate/Investor Engagement and with Thomson Reuters support of communication technologies. The Forum is providing continuing reports of the issues that concern this program's participants, as summarized  in the January 5, 2015 Forum Report of Conclusions.

"Fair Access" Home Page

"Fair Access" Program Reference

 

For graphs of specific company and related industry returns, see

Returns on Corporate Capital

See also 2011-2019 analyses of

Shareholder Support Rankings

 

 

 

Forum distribution:

Statistics on success rates for activist board representation

 

Source: FactSet Insight, March 11, 2014 article

Activists increasing success gaining board seats at U.S. companies

Mar 11, 2014

In another sign of the increasing influence of activist investors, the pace of activist campaigns resulting in board seats is running at a five-year high. In the first two months of 2014, activist investors were granted one or more board seats at 16 U.S. companies, the most since 2009 where 22 campaigns at 21 distinct companies resulted in board seats. Among the campaigns that resulted in board seats in January and February were those waged by prominent activists Elliott Management Corporation at Juniper Networks, Inc. and Compuware Corporation, GAMCO Asset Management Inc. at Ampco-Pittsburgh Corporation, JANA Partners LLC at QEP Resources, Inc., and Trian Fund Management, L.P. at Mondelez International, Inc. The full year campaign total resulting in board seats in 2013 was also a multi-year high.

The data includes all campaigns where activist investors attained board seats via a vote at a proxy fight, to settle a proxy fight, granted as part of other activist campaigns, or granted to prominent activists that are Schedule 13D filers but have not publicly agitated at the company, and is based on the date that the seat was granted or won. In 2013, the number of campaigns where the activist was granted a board seat without having to go to a shareholder vote increased by 9% from 2012 levels and 41% versus calendar 2011. Carl Icahn commented in a recent interview that even he was "surprised" by how often he is being invited to join company boards without having to launch a proxy fight.

While several factors may be contributing to this recent concessionary approach of U.S. companies, the wide spread support activists are getting from mainstream institutional investors is undoubtedly a key driver of the increased willingness of companies to offer up board representation. Sixty-percent of the proxy fights for board seats that went to an actual vote in 2013 resulted in a partial or outright victory for the activist. That's the highest win rate in the 13 years we have been tracking this data. By comparison, in 2003 the activist win rate was only 39%.

What makes the 60% win rate even more noteworthy is the fact that this statistic is artificially low. Companies and their advisers typically keep close tabs on preliminary vote tallies during a proxy fight and will often offer to settle if it appears that they may be on the losing side of the vote. For example, we saw Hess Corporation settle with Elliott Management the very morning of Hess' 2013 annual meeting.

These favorable conditions aren't being lost on activist investors as proxy fights for board seats announced at this point in the year is at a five-year high. As of March 7, 49 proxy fights for board seats have been announced. In the same periods in 2013 and 2012 44 and 41 proxy fights had respectively been announced.

 

This Forum program was open, free of charge, to anyone concerned with investor interests in the development of marketplace standards for expanded access to information for securities valuation and shareholder voting decisions. As stated in the posted Conditions of Participation, the purpose of this public Forum's program was to provide decision-makers with access to information and a free exchange of views on the issues presented in the program's Forum Summary. Each participant was expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants.  It is a Forum rule that participants will not be identified or quoted without their explicit permission.

This Forum program was initiated in 2012 in collaboration with The Conference Board and with Thomson Reuters support of communication technologies to address issues and objectives defined by participants in the 2010 "E-Meetings" program relevant to broad public interests in marketplace practices. The website is being maintained to provide continuing reports of the issues addressed in the program, as summarized in the January 5, 2015 Forum Report of Conclusions.

Inquiries about this Forum program and requests to be included in its distribution list may be addressed to access@shareholderforum.com.

The information provided to Forum participants is intended for their private reference, and permission has not been granted for the republishing of any copyrighted material. The material presented on this web site is the responsibility of Gary Lutin, as chairman of the Shareholder Forum.

Shareholder Forum™ is a trademark owned by The Shareholder Forum, Inc., for the programs conducted since 1999 to support investor access to decision-making information. It should be noted that we have no responsibility for the services that Broadridge Financial Solutions, Inc., introduced for review in the Forum's 2010 "E-Meetings" program and has since been offering with the “Shareholder Forum” name, and we have asked Broadridge to use a different name that does not suggest our support or endorsement.