Shareholder rebellion

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Shareholder rebellion occurs when the owners of a corporation work to throw out management or oppose their decisions. Shareholder rebellion may occur at a corporate annual meeting or through a proxy battle. Shareholders may also threaten to collapse a firm's stock price through concentrated selling.[1] In 1998, the Rockefeller family led a shareholder revolt against Exxon over its climate change policy.[2] In 2005, Michael Eisner retired after Walt Disney's nephew, Roy Disney, led a shareholder revolt, claiming Eisner was a micromanager who had caused a creative brain drain.[3] In 2010, British Petroleum[4] and Shell faced a shareholder revolt over its Canadian tar sands policy.[5]

Recently, shareholder rebellions have occurred over the issue of executive compensation at Cable and Wireless[6] and Shell;[7] Shell in response unveiled a plan to curb executive compensation and bonuses.[8] According to some analysts, institutional shareholders have been lax about holding management accountable because they were concentrating on picking correct stocks rather than protecting their interests in the stocks they owned.[9] With many firms showing poor performance, shareholder revolts are becoming more common.[10]

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References[edit]

  1. ^ John C. Coffee, Jr. (Oct 1991), Liquidity versus Control: The Institutional Investor as Corporate Monitor 91 (6), Columbia Law Review, pp. 1277–1368, JSTOR 1123064 
  2. ^ Clark, Andrew (2008-05-19). "Exxon facing shareholder revolt over approach to climate change". The Guardian (London). 
  3. ^ Lubove, Seth; Fixmer, Andy (2010-03-13). "Brain-eating zombies invade Disney in Iger plan to win boy fans". The Seattle Times. 
  4. ^ http://priceofoil.org/2010/02/08/now-bp-faces-shareholder-revolt-over-tar-sands/
  5. ^ MacAlister, Terry (2010-01-18). "Shell faces shareholder revolt over Canadian tar sands project". The Guardian (London). 
  6. ^ Wachman, Richard (2010-03-11). "Cable & Wireless facing shareholder revolt over executive pay". The Guardian (London). 
  7. ^ "Shell Shareholder 'Rebellion' Leads To New Limits On Executive Pay, Bonuses". Huffington Post. 2010-02-16. 
  8. ^ http://finance.yahoo.com/news/Shell-unveils-plans-to-curb-apf-853987459.html?x=0
  9. ^ "Time for a shareholder revolt". Reuters. 2009-10-27. 
  10. ^ Davey, Jenny; Ashton, James (2009-05-10). "To arms investors Its a shareholder revolt". The Times (London).