Shareholder activism is showing no signs of slowing as it continues to reshape the dynamics within corporations across various sectors. According to David Rosewater, head of Morgan Stanley’s shareholder activist defense practice, there was a marked increase in public campaigns by shareholder activists in 2024, compared to the previous year. Companies like Disney, News Corp., Norfolk Southern, and Southwest Airlines all found themselves at the center of significant public battles, highlighting the growing influence and determination of these activists.
Rosewater suggests that the activity observed this year is only a precursor to what is expected in the near future. He predicts an upsurge in shareholder activism as we head into the next proxy season. The movements occurring “under the surface” point to a structured escalation in activist efforts, as investors seek to assert more control and influence over corporate governance and decision-making processes.
The implications of this trend are significant for legal professionals working with corporations potentially subject to activist campaigns. Corporate legal teams and external counsel will need to remain vigilant and proactive in preparing for and responding to these challenges. Understanding the strategies employed by both activists and companies, and staying abreast of developments in this area, will be crucial.
For those interested in further details on the trends outlined by Morgan Stanley’s David Rosewater, you can find a comprehensive discussion of the current state of shareholder activism in the article from Above the Law.