Corporate Governance | Activism | FTI Consulting
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Corporate Governance & Activism

Shareholder activism is on the rise, making it increasingly important for boards and executives to be actively engaged with investors year-round. Activists are conducting more professional campaigns than in the past, producing materials that communicate in-depth analyses of targeted companies and seeking structural changes and longer-term involvement with targeted companies. Furthermore, because index funds have stringent corporate governance policies, activists have found opportunities to target companies with perceived insufficient oversight, despite strong financial performance.

Adding complexity to this scenario, boards can no longer think only of activism-focused funds as potential agitators. Historically, long-term shareholders have addressed in private concerns regarding strategy. Now they are starting to adopt more aggressive tactics, including public expressions of dissatisfaction with management actions. As a result, securing ongoing shareholder support for board and management initiatives has become a critical and complex task.

The FTI Consulting Corporate Governance & Activism team helps corporations effectively engage with key stakeholders to secure support for its strategic initiatives. The team, comprised of former investors and corporate governance experts, is also uniquely qualified to advise on complex governance issues as well as manage all aspects of a contested situation. In addition, we offer a comprehensive Stakeholder Engagement service that provides ongoing counsel and tactical support to clients as they interact with actively managed funds, index funds, and proxy advisors. This includes individually tailored services focused on specific goals.

Stakeholder Engagement: Secure Shareholder Support

Year-round strategic counsel supporting engagement with:

  • Actively managed funds
  • Index funds
  • Proxy advisors

Vulnerability analysis:

  • Financial performance relative to peers (updated quarterly)
  • Corporate governance assessment
  • Annual executive compensation assessment:
    • Peer group analysis
    • Alignment between executive pay and company performance

Shareholder base analysis:

  • Monitoring changes in the shareholder base
  • Annual perception study

Proxy Contests & Contested M&A: Maximize Outcomes in a Fight

  • Strategic advisory
  • Vulnerability analysis (financial performance and governance)
  • Shareholder engagement strategies
  • Contest materials development
  • Proxy advisory messaging and engagement

Preparedness & Planning: Mitigate the Risk of Activism

  • Vulnerability assessment (analyzing financial performance, executive comp, and corporate governance)
  • Investor perception insights
  • Shareholder base and voting analysis
  • Hostile/activism defense planning

M&A Advisory: Enhance Certainty of Close

  • Strategic advisory
  • Activism risk assessment (financial and sales process analysis)
  • Proxy advisory risk assessment
  • Regulatory/political risk assessment
  • Multi-stakeholder comms roll-out
  • Merger integration communications

Proxy Advisory Prep: Influence the Influencers

  • Strategic advisory
  • Presentation drafting/review
  • Script drafting/review
  • Q&A preparation
  • Mock interview sessions

Regaining Shareholder Support: Reverse Negative Vote Outcomes

  • Analysis of drivers for negative proxy advisor recommendation and/or shareholder vote on economic, governance and compensation issues
  • Strategic plan to revert the negative outcomes

Governance Assessment: Inform Decision-Making and Messaging

  • Analysis of governing bylaws and processes
  • Investor perception insights
  • Assessment of executive compensation alignment
  • Shareholder base and voting analysis
More Info

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