As I said a few weeks back on my show Stock Wars, this year will be a game changer for shareholder activism – quite possibly a Golden Age.
David Weidner wrote a killer story on how 2010 is shaping up to be “a watershed year” for dissident shareholders and activist campaigns in the Wall Street Journal this morning…
What can make a difference is coordinated shareholder activism. Of course, that demands shareholders actually vote – right now, the majority don’t. Proxy season is just around the corner. Board seats are on the line. Critics are doing battle with companies such as Denny’s Corp., Cascade Financial Corp. and Genzyme Corp. which is being targeted by Carl Icahn.
This year could be a watershed for the dissidents looking to shake up companies. Technology has made it easier for shareholders to come together and vote. Proposed financial reform includes a say-on-pay provision, something more than 50 companies have adopted voluntarily. Even big fund companies known for being passive when it comes to management are rethinking their approach. Populist angst is looking for an outlet.
I view the strengthening of legislative support and the groundswell of shareholder influence as a major positive for the markets. Accountability is in fashion this season and Responsibility is The New Black.