Gob Cvo

themes

What should be the time-horizon of investor engagement? Do activist investors have too narrow a focus on short-term gains? How is engagement most effective? Is there a particular governance or ownership structure that promotes better engagement? How can mainstream large mutual funds and asset managers increase their level of engagement with companies? Are there specific incentives (or lack thereof) that prevent institutional investors from becoming more actively involved with their portfolio companies?

Mary Schapiro

Pershing Square

highlighted the positive impact of say-on-pay votes, and better disclosure of director qualifications.

SEC's commitment to address proxy voting mechanics and the rules around beneficial ownership disclosure.

first panel

Reuters Editor-at-Large Chrystia Freeland

agency's efforts to improve engagement between shareholders and their investee companies

Bill Ackman,

active ownership, and opposed the notion that activists have a short time horizon

engaging with management and the board, he argued.

Martin Lipton

Wachtell

Lipton, Rosen and Katz

acknowledged that some activist investors with long-term significant positions may benefit investee companies.

obsession for shareholder value in terms of quarterly results

diffused ownership of U.S. corporations

constitute "the greatest threat to the economies of the western world." 

Mats Anderson, CEO of the Fourth Swedish National Pension Fund

Runa Urheim

Scandinavian perspective

Norges Bank

Swedish system of boards fully comprised of independent directors and shareholder-led nomination committees

Norges Bank

ave a significant shareholder.

Nadia Calvino

Internal Markets and Services of the European Commission

view corporate governance as a key component of a well-functioning economy

new requirements should be made with great caution, since it may have substantial impact on numerous parties. 

second panel, Julian Franks

perspective of labor funds

"Unfulfilled Expectations? The Returns to International Shareholder Activism.”

paper

compared shareholder activism in Europe, North America, and Asia

abnormal returns when the activism results in specific measurable outcomes, such as changes on the board, payout policies, restructurings, and takeovers.

Brandon Rees

London Business School

AFL-CIO’s Office of Investment,

endorse active ownership but maintain a buy-and-hold investment perspective

easier access to companies' boards through proxy access and other means of engagement is in the best interests of all minority shareholders.

final panel

role of institutional investors and the barriers to engagement with corporations

law at the University of Pennsylvania

law professor at the University of Munich

Calvino's view that regulators should tread carefully in order to avoid any unintended consequences of regulatory action, and opposed the notion of mandatory engagement.

Horst Eidenmulle

Edward Rock

free rider problem among institutional investors, who are competing on cost, price, and performance relative to peers.

little incentive for any individual player to take on the costs of engagement with uncertain benefits as in comparison to its peers.

Luigi Zingales of the University of Chicago

institutions' lack of incentives to engage

the costs of engagement may be significant for individual institutions, there may be opportunities to overcome the collective action problem by permitting greater collaboration among investors and easier access to the board by minority holders,

voto di lista system