“We are no target for shareholder activists.” I hear this every other day. From small- and mid-cap companies (and sometimes even large caps) all across the U.S. and abroad, from executive officers, board members and others. Occasionally this assessment is correct. More often than not, however, it is not. It only reflects common misconceptions.
For example, many companies believe that shareholder activism is on the decline because they do not read about it in the news all the time any more. In fact, shareholder activism is as prevalent as ever. There were 233 publicly reported activism campaigns in the U.S. in 2016. Since many activism situations are resolved outside the public eye, we estimate that the number of actual activism campaigns is at least 400 annually. There are around 4,200 public companies in the U.S., which means that activists will target approximately 10% of Corporate America—each year.
