Many shareholders raise concerns informally, without filing resolutions, and many who file resolutions negotiate with management and withdraw them. For example, the New York City pension funds were able to persuade companies to adopt 13 of their proposals in 1994, and it is clear that most shareholders, managers, and directors expect to pursue this spirit of cooperation. All three groups have made their other plans and expectations for the next year very clear. Shareholders Shareholder activism has evolved very quickly over the past decade. From a way to raise concerns over social policy issues to an outraged response to the abuses of the takeover era, it has become almost exclusively concerned with value.
Shareholder activism is no longer a fringe activity for institutional investor fiduciaries.
Involvement in governance is now an essential component of investment management. Time and experience have demonstrated that investors, whether large institutions or individual shareholders, can protect and enhance the value of their investments through shareholder activism at least as cost-effectively as they can through trading, and often moreso. The economic evidence is clear enough that no fiduciary can fail to consider activism as an investment strategy, or fail to pursue it, if the likelihood of success seems reasonable. And the returns are compelling enough to persuade those exemplars of economic rationality, the Wall Street analysts and money managers, that activism is a highly competitive investment strategy. The merging of governance into the mainstream of asset management is the real story at this stage of shareholder activism.