Lori Marks-Esterman Quoted in The Deal on Semiannual Reporting Redefining Activism

Lori Marks-Esterman, Chair of Olshan's Litigation Practice Group and Head of Olshan’s Shareholder Activism Litigation Practice, was quoted in The Deal (subscription required) on the U.S. Securities and Exchange Commission’s (SEC) expected change in rules that could allow public companies to report earnings semiannually instead of quarterly. As a result of this expected shift, executives and boards will need to carefully consider when and whether to make a switch, as a change could reshape the dynamics of shareholder activism. While the decision to adopt semiannual reporting can support a company’s long-term strategy, a poorly timed move could intensify activist pressure rather than reduce it. Lori noted, however, that the idea that semiannual reporting means that activists will have fewer entry points, “presumes that activists are [] launching campaigns in response to one quarter’s worth of information” which is generally not accurate. “Larger activists devote extensive resources to understanding companies, so one quarter moving up or down isn’t motivating them in their investment,” she said.