Topic Results: Activism

October 5, 2015

Will a New Paradigm for Corporate Governance Bring Peace?

The decades-long conflict that is currently raging over short-termism and activist hedge funds strikes me as analogous to the Thirty Years’ War of the 17th Century, albeit fought with statistics (“empirical evidence”), op-eds and journal articles rather than cannon, pike and sword. I decided, after some thirty-six years in the front line of the army […]

September 13, 2015

The Game Of ‘Activist’ Hedge Funds: Cui Bono?

This paper aims to describe the contemporary tactics and objectives of activist Hedge Funds as well as the actions taken by targeted companies as a result of their intervention. While doing so, we explored the consequences of activism over time when compared to a random sample of firms with similar characteristics at the time of […]

June 23, 2015

Activism, Short-Termism, and the SEC

Today, I’d like to pull together some themes that I have been thinking, speaking, and writing about during my tenure and address them more holistically. Specifically, I’d like to share with you some thoughts about shareholder activism, short-termism, and the SEC. I. What is activism? Like many others, I view activism broadly: it is simply […]

June 17, 2015

The free advice of activist investors is worth plenty to shareholders

At 8:38 a.m. on June 11, the activist investment firm Elliott Management—run by billionaire Paul Singer—disclosed that it controlled a 7.1% interest in software vendor Citrix Systems, and wanted to meet with management to discuss its proposal to overhaul the company. More than seven hours passed before Fort Lauderdale-based Citrix CTXS, +0.86% produced a noncommittal, […]

June 1, 2015

The Lessons of DuPont: Corporate Governance For Dummies

“Among practitioners, it is a customary cliché to say that all proxy contests—just like all trials—are unique and idiosyncratic. There is some truth to that easy generalization, but it also misses the forest for the trees. Some obvious truths stand out in the recent battle between Trian Fund Management and DuPont that will apply to […]

May 28, 2015

IGOPP mentionned in the Wall Street Journal, the MorningstarAdvisor and the Dow Jones Newswires

The Executive Chair of the Institute, Dr. Yvan Allaire,  is mentionned in the Wall Street Journal, the MorningstarAdvisor and the Dow Jones Newswires! In an article about the activist hedge funds. “U.S. businesses, feeling heat from activist investors, are slashing long-term spending and returning billions of dollars to shareholders, a fundamental shift in the way […]

May 26, 2015

Firms Send More Cash Back To Shareholders

“U.S. businesses, feeling heat from activist investors, are slashing long-term spending and returning billions of dollars to shareholders, a fundamental shift in the way they are deploying capital. Data show a broad array of companies have been plowing more cash into dividends and stock buybacks, while spending less on investments such as new factories and […]

May 26, 2015

Companies Send More Cash Back to Shareholders

U.S. businesses, feeling heat from activist investors, are slashing long-term spending and returning billions of dollars to shareholders, a fundamental shift in the way they are deploying capital. Data show a broad array of companies have been plowing more cash into dividends and stock buybacks, while spending less on investments such as new factories and […]

May 7, 2015

Why Run Away from the Evidence?

“Martin Lipton is a founding partner of Wachtell, Lipton, Rosen & Katz, and this post is based on a Wachtell Lipton memorandum. The post puts forward criticism of an empirical study by Lucian Bebchuk, Alon Brav, and Wei Jiang on the long-term effects of hedge fund activism; this study is available here, and its results […]

April 20, 2015

The DuPont Proxy Battle: New Myths, Old Realities—and Even Newer Data About Hedge Fund Activism

A watershed moment is coming for shareholder activism and corporate governance generally, as the proxy contest brought by Trian Management Fund, seeking effectively to break up DuPont, enters its final stages (with the vote being less than a month away). Technically, the contest is to elect four Trian Fund nominees to the DuPont board, but, […]

April 11, 2015

Further Recognition of the Adverse Effects of Activist Hedge Funds

“Despite the continued support of attacks by activist hedge funds by the Chair of the SEC, and many “Chicago school” academics who continue to rely on discredited statistics, there is growing recognition by institutional investors and prominent “new school” economists of the threat to corporations and their shareholders and to the economy of these attacks […]

February 25, 2015

Twelve Ways to Become a Hero : Inside the Activist’s Playbook

” But it’s no joke to Yvan Allaire, Executive Chair at the Institute of Governance, who believes The Economist is running infomercials for activist hedge funds: On a topic requiring sober, balanced coverage, The Economist cuts logical corners, tramples contrary evidence, ignores a vast store of scholarship, and conjures up an empirical “study” to produce […]

February 13, 2015

The Economist’s activist hedge fund infomercial

With its knack for tackling big subjects in a one-sided manner, The Economist in its February 7th issue imagines a dystopian world where corporate managers and boards of directors are generally incompetent, most investors are lazy; but “activists are a force for good”, “capitalism’s unlikely heroes” and “the saviours of public companies”! Even for a […]

February 6, 2015

Engagement and Activism in the 2015 Proxy Season

“Yet companies, boards, and other investors should keep in mind that shareholder activism is often merely a tactic in a self-interested investment strategy. Shareholder activists such as hedge funds typically are pursuing short-term financial gain at the expense of long-term shareholders and stakeholders. These funds welcome the support of academics and theorists who argue that […]

February 3, 2015

How Pershing Square found success at Canadian Pacific Railway

In 2011, Pershing Square Capital Management, an activist hedge fund founded by William (Bill) Ackman, acquired some 14.2% of Canadian Pacific Railway’s outstanding shares and proceeded to require several changes in the management and governance of the company. The CP board resisted fiercely his entreaties. A memorable proxy fight ensued, which was won by Pershing […]

January 30, 2015

The State of Corporate Governance for 2015

Financial Activism ” Over the past three years, the number and intensity of financial activism initiatives has increased. The ongoing debate on the wealth effects of hedge fund activism is worth following and is well-covered on Harvard’s corporate governance blog (blogs.law.harvard.edu/corpgov). Although financial activism may return immediate wealth to some shareholders through the sale of […]