Insights / March 14th, 2018

Shareholder Activism

Cowell Clarke is a member of the global legal network, ALFA International. Earlier this month in Scottsdale, Arizona Brett Cowell gave a presentation to ALFA’s international client seminar on shareholder activism and how boards of directors and their legal advisers should prepare for and respond to a shareholder activist approach.


  1. Activists typically target companies with poor share price performance, under-performing capital allocation and/or poor corporate governance or compensation practices.

  2. Boards must keep these 3 areas under review and be prepared to implement tough and even radical options, and quickly.

  3. Boards, with their advisors, should review on a regular schedule how activists might think about the company and how the company would respond. Boards should prepare a playbook so they are well prepared in the event of an activist approach.

  4. Boards should be prepared to engage with activists. Reflexively stonewalling an activist may be counterproductive. Activists are often well prepared and resourced and may be able to contribute real value.

  5. Boards must understand who is on (or coming onto) the company’s share register and why and boards must maintain real dialogue with shareholders, including about the areas referred to in paragraph 1.

A link to the paper is below.

If you would like to discuss preparing for or responding to a shareholder activist approach, please contact Brett Cowell.