Shareholder activism key to holding companies accountable

Local retail investors have been urged to consider the importance of shareholder activism as a way of keeping companies and executives on their toes in terms of management responsibility.

Traditionally, large institutional investors and fund managers dominate the share registers of listed and unlisted entities locally, with retail investors carried along on the decisions the former make. Retail investors tend to adopt dormant positions in the register and instead of informing themselves about issues of concern, rely on proxies to make their decisions.

In developed countries, however, shareholder activism has seen all classes of investors inform themselves and coordinate campaigns against mismanagement, environmental recklessness or poor financial performance, forcing corporate leaders to account.

Editor's Comment
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