On 13th June Fidelio held a Board breakfast entitled ‘Activism and the Board’ with Cas Sydorowitz (CEO, Georgeson), Behdad Alizadeh (Co-Founder and Managing Partner, AltaOne Capital) and Nick Paris (Portfolio Manager, LIM Advisors).
With shareholder activism on the rise in Europe, this was a timely and lively discussion, which explored the activist agenda, how Boards can engage effectively with activists, and the implications for Board composition.
The breakfast was well attended by Chairmen, Non-Executive Directors, former CEOs and Company Secretaries of major quoted companies from a range of sectors and geographies.
Over breakfast a few key points emerged:
- The keys to pre-empting and effectively managing an activist situation are engagement with shareholders and alignment of Board composition with the strategy and equity story.
- The ability to engage effectively with shareholders is increasingly seen as a key competency at Board level. Directors have a responsibility to remain abreast of investor sentiment and need to understand channels and means of communication with shareholders. Equally Directors of public companies should care about the calibre of Investor Relations.
- Fidelio is acutely aware that Board composition is a key contributor to valuation. In an activist situation Board seats may become a currency for negotiation, with activists seeking to replace existing Directors with individuals they deem to be more qualified. The wise Chair will be on the front foot with a proactive focus on Board composition and Board effectiveness as a means of mitigating the activist risk.
Fidelio contributes to Board effectiveness through Search, Development and Evaluation. We are keen proponents of shareholder and stakeholder engagement, and the importance of diversity in enhancing Board effectiveness.
If you are interested in receiving the full summary of this event, or learning more about how Fidelio supports Boards, please do not hesitate to get in touch.