The Role of Activist Investors in Shaping Corporate Board Structures

Download or read book The Role of Activist Investors in Shaping Corporate Board Structures written by Bianca Ungersböck and published by . This book was released on 2019 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Shareholder activism continues to shape the corporate world. One of the most influential ways to bring about the desired change for activists is corporate board representation. This thesis therefore examines whether the chances of obtaining board seats depend on the qualifications of activist director nominees. For that purpose, a hand-collected dataset of directors who are nominated by the dissident group is created. Moreover, I assess whether company and campaign characteristics meaningfully impact the election outcome. While my empirical analysis does not show any clear relationship between the skill set of directors and their election results, the opposite is true for campaign and company attributes. Small, undervalued firms with poor financial performance are at greater risk of having activist directors join their boards. Additionally, larger equity stakes in the targeted firm, shorter campaign duration, fewer nominees per campaign and most importantly support by a proxy advisor firm greatly contribute to the success chances of obtaining board seats for activists.