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Shareholders Activism And Role Of Institutional Investor

Shareholders Activism
What is shareholder activism?

Definition ii. Explanation What can shareholder activists do? What does shareholder activism mean to you? The key drivers for activism.
i.

Regulatory Reforms
Shareholder Meetings and Voting

2001 2010 2012 2013

Voting by postal ballot introduced for certain types of resolutions Option to companies to hold shareholders meetings through video conference and other electronic means E-voting made mandatory for top 500 companies listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). introduced significant the listing agreement that are SEBI The Companies Bill, 2012 changes approvedto by the Lok Sabha contains aimed at protecting shareholder interests expanded rights to minority shareholders, including rights in to mergers approve and certain other forms of transactions corporate restructuring involving listed companies. related-party

Activism in Action: TCI vs. Coal India

Shareholders Activism
International Trends

Overall Perspective
Moving Ahead

Institutional Investors
What Are Institutional Investors

Definition ii. Explanation


i.

A Checklist for Dealing with Activism


Exercise stewardship and greater oversight by participating

in corporate decision-making
Be more transparent about voting policies generally and the

exercise of votes in specific meetings


Inculcate the practice of attending all general meetings File questions, requests for additional information or

objections with the companies and insist on response at the


meeting

A Checklist for Dealing with Activism


Positively engage with companies and provide strategic

direction to enhance overall shareholder value


Work with companies to develop a set of best practices

on corporate governance that they could adopt


Rely upon proxy advisors and other governance

intermediaries, but only after exercising due diligence regarding the absence of any conflict of interest of such intermediaries

Increasing the Role of Institutional Investors in CG


Policy on voting and disclosure of voting activity

Policy on managing conflicts of interest


Monitor their investee companies To be willing to act collectively with other investors To establish clear guidelines on when and how they will escalate

their activities as a method of protecting and enhancing shareholder value


To report periodically on their responsibilities and voting activities

Thank you