Overview

In many UK boardrooms, "activism" remains a dirty word. It is nevertheless an established part of the corporate landscape. As well as some high profile activist situations, there has been much press commentary on the drive for greater shareholder involvement. Anecdotally, shareholder activism is forcing
senior management to become more open and better skilled at communicating with their institutional shareholders – which can only be a good thing.

In its softest form, shareholder activism can be no more than the gentle suggestion of strategic direction. Even in these instances, however, there is always the implicit threat of the exercise of statutory powers, and often this is made explicit. Hedge fund investors who acquire a reputation for activism are less likely to be welcomed on a company's register by its board, so there are marked variances as to how much investors are prepared to put their head above the parapet.

There are numerous weapons in the activist armoury, but also a minefield of potential issues to be avoided. These are obviously pertinent to shareholders who are leading an activist agenda, but can be relevant for other long investors who become involved in supporting a potential activist strategy.

In this briefing, Travers Smith sets out some of the key issues to watch out for in any activist agenda.

Click 'View Briefing' to read more.