TheShareholderActivist.com™ is a resource for investors for education, enlightenment, and, above all, empowerment. Therefore, exploring the definition of Shareholder Activism can help you envision your potential to affect change, and evolve from a passive investor to an empowered activist.
Socially Responsible Investing
Essentially, there are several ways in which the term Shareholder Activist is applied. One common application is that of an individual who attempts to leverage his or her rights as a shareholder of a publicly-traded corporation to affect social change. This is an increasingly popular area of activism.
This can involve various issues, from the environment and conservation, to political action and investments in sensitive regions of the world. Socially responsible investing (otherwise known as ethical or socially-conscious investing), aspires to an investment strategy that not only maximizes the financial return on investment, but simultaneously emphasizes social and corporate responsibility.
Holding Management Accountable
The concept of Shareholder Activism can also refer to investors who contend that a corporation’s leadership is mismanaging their investment. Such activism encompasses strategies and tactics designed to exert pressure to influence a corporation’s behavior by exercising their rights as owners.
There is a distinction here, as the shareholder has a stake in the company, and is therefore an owner. However, unless formally designated, that owner is not a manager. Therefore, the role of the investor as shareholder activist is to influence management to affect change, for the overall benefit of the company. As such, there are processes to be adhered to and a corporate structure to navigate—albeit often complex, and not always investor friendly.
Where investors become activists, TheShareholderActivist.com’s™ mission is to provide a social media platform for responsible shareholder activism—empowering investors as never before to fully exercise their rights as equity stakeholders and help ensure the viability and sustainability of the publicly traded corporations they own.
This site will provide guidance, in the form of tools, tactics, and techniques, to affect change for the betterment of the enterprise. However, the foundation of action must always be rooted in responsibility. The actions you take may have serious consequences, for yourself, your colleagues, the company, even the entire industry. Proceed with caution and act prudently. When in doubt, we strongly recommend you seek the guidance of an expert and/or an attorney (TheShareholderActivist.com™ can recommend resources to help you make the right decisions, when they count the most.)
Collaboration vs. Confrontation
If you are seeking change, chances are you are emotionally charged and passionate. However, collaboration is always a preferable conduit for change than confrontation. Sure, there may be times when more aggressive tactics may be warranted. But first, seek to influence management, not antagonize board members.
Ask yourself how much of your decision and actions are based on emotion? Step back, evaluate the situation objectively, and make sure your motivation is truly in harmony with the goal of improving the company.
And get ready to work hard. No one said activism was going to be easy. Seek to engage in a dialogue with management, perform your due diligence and understand the full scope of the issue, rally support and build consensus among the shareholder base, and formulate effective proposals that are realistic and can be voted on during the annual meeting.
This site will help you accomplish these objectives, but the burden of action will be on your shoulders.
Goal-setting = Effective Activism
The guidance we provide is for activities, not passivities. An effective shareholder activist does more than simply shed light on inadequacies, but also brings to the conversation potential solutions, or at least alternatives. In many respects, this is the difference between antagonism and activism.
As a shareholder activist, don’t just dispute. You need to contribute. Based on your equity investment, you have a tangible connection to this corporate entity. Depending upon the size of that stake, you can exert pressure on management, and/or rally support to your cause.
Essentially, your activism is defined by your objectives. You may have financial objectives (increase value for investors through changes in policy or leadership) or non-financial (championing social investing policies).
Obviously, more ambitious strategies, such as hostile takeovers, require much deeper resources.
You have a voice and an opinion. Ultimately, it is up to you how you want to use them to affect actionable change for the betterment of the company.
What type of Shareholder Activist will you be?
To contact Craig McGuire directly, please email Craig.McGuire@TheShareholderActivist.com.