Activist Investors: Some Implications for Corporate Governance

Abstract

This paper discusses the recent phenomenon of activist investors in UK quoted companies in the context of recent developments in UK corporate governance. We present three case studies of recent activist investor intervention and discuss the implications for corporate governance regulation, that is, how can boards of directors ensure that the rights of all shareholders are maintained in these situations. We conclude that in order to promote effective corporate governance, existing codes of behaviour will need to be modified in order to address potential problems.

Keywords: corporate governance, activist investors, Combined Code, UK

JEL Classification: G34, G15