Andrew Freedman Interviewed by CTFN on the Present State of Shareholder Activism
Co-Head of Olshan’s Shareholder Activism Practice Andrew Freedman was interviewed by CTFN’s Tima Gecaj (subscription required) on the present state of shareholder activism amidst the pandemic and where things are heading. Freedman points out that, at the beginning of the pandemic, “many of our clients were willing to agree to truces in situations where they would have otherwise kept the pressure on towards the annual meeting vote. So, in March and April there was certainly a shift in the tactics, with most campaigns taking a softer approach with less public back-and-forth between the activists and the company.” Freedman observed that the abundance of activist campaigns in foreign jurisdictions, including in Asia, Europe, and Australia, signals that U.S.-based investors have largely forgone their initial trepidation over the challenges of launching a foreign campaign. “It is a different type of activism that is conducted outside the U.S.,” he says, “and the activist has to adapt in many ways not only to the rules and regulations in different jurisdictions, but also to various other campaign dynamics. These include how the engagement process works with management, the board, and other shareholders. We expect to see increased levels of activism in foreign jurisdictions both as the U.S. market continues to become crowded and as other countries around the globe embrace the positive impacts that shareholder activism has on their economy.” Over the next year, he predicts that Japan and Europe will continue to be prolific sites for activists and that ESG (Environmental, Social, and Governance) will remain a prime managerial concern. On the hot-button topic of ESG, Andy explained that “the ‘E’ and ‘S’ had taken a backseat until recently, but are now having their moment too….An activist’s role is to help catalyze changes aimed at improving companies, and it’s no different in terms of ESG.” He concludes by noting that “activism is going to rebound in a major way in 2021, not unlike the way it rebounded after the financial collapse in 2008, and we’re beginning to see the initial wave of that play out right now."