Cutting Loose From Shareholder Activists

A quick glance at the 1991 proxy season might prompt you to think peace has broken out between corporate management and activist shareholders. Sure, there were a few headline-grabbing fights--notably the attempt by dissident Robert A. G. Monks to win a board seat at Sears, Roebuck & Co. But even while Monks was losing, the number of proxy contests for board seats was declining. So were victories by dissidents. And this year, many executives who faced pesky shareholder proposals decided instead to bargain. Of the 153 corporate governance proposals submitted by institutions, only 101 came to a vote, according to Georgeson & Co., the proxy solicitors. Companies such as Avon, Xerox, and W. R. Grace volunteered to change their ways.

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