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New Proxy Monitor Report/Lucian Bebchuk Responds to Wachtell Lipton on Hedge Fund Activism.

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The Manhattan Institute's Center for Legal Policy released its third annual survey of shareholder proposals at Fortune 250 companies today. This report draws on the Proxy Monitor database to examine shareholder activism in which investors attempt to influence corporate management through the shareholder voting process. The report suggests that the shareholder-proposal process is dominated by a small subset of investors, particularly labor-affiliated pension funds, whose interest may be adverse to the typical shareholder's.

The report discusses several key trends in the 2013 proxy season, including:

• The number of shareholder proposals introduced has increased, but support for these proposals has declined.
• Just 1 percent of shareholder proposals were sponsored by institutional investors unaffiliated with organized labor or a social, religious, or public-policy purpose.
• Labor-affiliated shareholder activism appears to target companies that are more politically active, especially those more supportive of Republicans.
• Shareholder proposals related to corporations' political spending or lobbying were the most common type of proposal but attracted little support.

The full report is available for download here.

In related news, Lucian Bebchuk co-authored a response to Wachtell Lipton's strong criticism of his recent empirical study on the long-term effects of hedge fund activism. The Wachtell, Lipton memos, co-authored by Martin Lipton and several other senior lawyers in the firm, are available here and here. Professor Bebchuk's post is also available on the Harvard Law School Forum here and as a PDF here.

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Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute
igorodetski@manhattan-institute.org

Katherine Lazarski
Press Officer,
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.