NIRI research: eight years of activism

Mar 01, 2016
<p>IR body looks at how the shareholder activism climate has changed across the US</p>

The number of IR professionals reporting having had an activist on the register has jumped by 70 percent over the past eight years, according to research from NIRI.

In 2007 when the US IR body last carried out the survey, almost half (47 percent) of IROs stated that an activist investor had owned their company’s stock at one point in time. This figure had risen to 80 percent in 2015.

‘Interestingly, the percentage of IR professionals who ‘don’t know’ whether an activist investor has ever owned their company stock has reduced dramatically over the same period of time, from 20 percent in 2007 to a mere 4 percent in 2015,’ write the study authors.

What hasn’t changed, however, is how IROs are most likely to learn of an activist’s interest or involvement in the stock: direct contact by the investor is reported by 49 percent of IR professionals, the same as in 2007.

The use of SEC filings in identifying an activist has dropped slightly, falling 6 percentage points to 20 percent in 2015; the use of stock surveillance firms now stands at the same level, having climbed 3 percentage points over the past eight years.

When it comes to what activists want, NIRI says business strategy continues to be the main focus (36 percent), though this has dropped from 47 percent of campaigns eight years ago. Calls for the return of capital have seen a big push, climbing from 6 percent in 2007 to make up a third of campaigns last year. Board representation has also had a boost, with almost a quarter of campaigns (24 percent) seeking to put someone on the board in 2015, up from 16 percent in 2007.

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