We’ve written in the past about divestment versus activism/engagement as ESG investment strategies and catalyzing change in companies. Over on TheCorporateCounsel.net, Liz just blogged about what institutional investors think about shareholder activism:
SquareWell Partners – a Europe-based shareholder advisory boutique for high profile “special situations” – recently published the latest edition of its survey on institutional investors’ views on shareholder activism (available for download).
This year’s survey includes responses from 30+ global investors – representing $35 trillion in assets under management. SquareWell asked how these institutions view activism, what drives their support for activist campaigns, and how boards can engage more effectively to avoid escalation.
Some highlights:
- Most investors (77%) view activism as a useful force for catalyzing change and accountability.
- A key concern (65%) is that activists may oversimplify complex businesses or adopt overly short-term views and cause disruption.
- Board-related activism tied to governance and management change is most supported (71%), while M&A and balance sheet activism receive minimal backing (3%).
- Nearly half of investors are open to engaging before a campaign is public; many also consult peers to gauge broader sentiment.
That first point sure seems counter to calls for divestment from holdings not considered sustainable or ESG-aligned, especially given the last point about willingness to engage with companies before making a public spectacle of an issue. Those points aren’t really that surprising to me, but point #2 was. Granted, SquareWell’s survey reflects more than just sustainability, social and DEI activism – which typically reflect a long game.
Members can read more about shareholder activism here.
DID YOU KNOW … we are much more than just blogs. PracticalESG provides tools and guidance for in house staff and outside advisors – from beginners to senior practitioners. We scour third party resources, vetting and filtering them – saving you hours of your day. And we don’t use AI to produce any content or have annoying ads.
If you’re not already a member, sign up now and take advantage of our no-risk “100-Day Promise” – during the first 100 days as an activated member, you may cancel for any reason and receive a full refund. But it will probably pay for itself before then.
Are you a client of one of our Partners – SourceIntelligence, Kumi, Ecolumix, Elm Consulting Group International or Impakt IQ? Contact them for exclusive pricing packages for PracticalESG. Practical Guidance for Companies, Curated for Clarity.
Sign up here for daily blog updates delivered right to you.
